Should I choose a fixed or floating rate bank loan?
Fixed rates are currently better for most borrowers as they offer a combination of savings and payment certainty while rates are expected to rise.
Last updated: 8 May 2026
The choice between fixed and floating depends on your view of interest rates and your tolerance for payment variability.
Fixed rate (currently ~1.30%-1.88%):
- Monthly repayment stays the same for the lock-in period (2-3 years)
- Offers certainty and ease of budgeting
- Slightly higher than floating today, but protects you if SORA rises
- Best choice when rates are near a floor and likely to increase
Floating rate (currently ~1M SORA + 0.00% to 0.25% ≈ 1.03%-1.38%):
- Repayment moves with SORA monthly or quarterly
- Slightly cheaper today, but could increase
- Better suited to borrowers who monitor rates actively
- Makes sense if you believe SORA will fall further