South Korean households' savings grew at the slowest pace in almost eight years in 2015 as South Koreans struggle to meet spending commitments and sought after investment vehicles offering higher returns amid low interest rates, data showed Sunday.
  

Households' deposits at banks stood at 547.74 trillion won ($494 billion) at the end of April, up 5.1 percent, or 26.55 trillion won, from a year earlier, according to the data compiled by the Bank of Korea.
  

Of the tallied, savings deposits, which earn interests for a relatively long period of deposit, stood at 492 trillion won, growing 3.8 percent over the cited period, marking the lowest since September 2008 when the comparable figure was 1 percent on-year expansion, the data showed.
  

The slowdown in household deposits is attributable to low interest rates in Asia's fourth-largest economy and investors seeking higher returns.
  

In contrast, demand deposits, on which banks usually pay no interests, surged 18.1 percent on-year to reach 55.69 trillion won as of end-April, the data showed, indicating that idle money has snowballed amid low bank deposit rates.
  

"Low interest rates forced bank customers to manage their money on a short-term basis and chase after other investment vehicles that provide higher returns," said Lee Seung-hoon, a researcher at KB Financial Group.
  

Earlier this month, South Korea's central bank cut its policy rate by a quarter percentage point to a fresh record-low of 1.5 percent as the local economy is feared to face a further slowdown in domestic demand caused by the outbreak of Middle East respiratory syndrome.
  

Usually, a long streak of low rates leads to a fall in deposit rates, prodding bank customers to withdraw their money to invest in other tools that give high returns.
  

Separate data also showed that customer deposits for stock investment surged to 20.99 trillion won as of end-April, up 6.24 trillion won, or 42.3 percent, from a year earlier. (Yonhap)