Two more banks appointed to manage Child Development Accounts

Channel NewsAsia, 12 Sep 2014

DBS Bank and United Overseas Bank (UOB) have been appointed by the Ministry of Social and Family Development (MSF) as managing agents (MAs) of the Child Development Accounts (CDA) under the Baby Bonus Scheme.

In a media release on Friday (Sep 12), MSF said both banks will start providing CDA services from the second quarter of 2015. Oversea-Chinese Banking Corporation (OCBC) and Standard Chartered Bank are the two current MAs, but the latter will continue to manage existing CDAs only until end-2018.

The ministry said for parents whose kids turn 12 by end 2018, they need not switch their CDA accounts to another bank. "The unused balance in your child's CDA will be transferred to his or her Post-Secondary Education Account (PSEA) in the year your child turns 13 years of age."

It added that for parents who do need to transfer to a new MA, they can do so via a new Baby Bonus Online system before end 2018.

As to why StanChart will no longer be one of the MAs, it said: "MSF conducted an open tender for the appointment of new managing agents. We evaluated various aspects of each bank’s proposal, before deciding to award the managing agent contract to DBS, OCBC and UOB."

DBS released a statement saying it is "honoured" to be appointed as an MA. "We will be working closely with MSF to reward parents for investing in their children’s development and to encourage greater savings,” said its Managing Director and Head of Consumer Banking Group for Singapore, Mr Jeremy Soo.

UOB called its appointment a "privilege". Mr Dennis Khoo, UOB Group Head of Personal Financial Services in Singapore said the bank its committed to putting together a "comprehensive and attractive package" for the UOB Children Development Account.

NEW BABY BONUS ONLINE SYSTEM

The Baby Bonus Online system will be introduced in the second quarter of next year.

"With the online system, parents will no longer need to fill up hard copy forms and make a trip to the bank to open CDAs. Parents-to-be can join the scheme as early as two months before the estimated delivery date of their child," said MSF. More details of the online system will be revealed next year.

Parents can also expect to receive the cash gifts and have their CDAs set up within a shorter time of seven to 10 working days of the child’s birth registration.

The Government matching will be received within a shorter time of two weeks after making deposits. Parents can also review their choice of MA and make changes online at their convenience, according to the press release.