From the second quarter of next year, parents will enjoy more banking choices and greater convenience under the Baby Bonus Scheme.
The Ministry of Social and Family Development (MSF) has appointed three banks as managing agents (MAs) for Child Development Accounts (CDAs) under the Baby Bonus Scheme. They are DBS Bank Limited (DBS), United Overseas Bank (UOB) and Oversea-Chinese Banking Corporation Limited (OCBC). OCBC is an existing MA, while DBS and UOB are newly appointed MAs which will start providing CDA services from the second quarter of 2015.
The Standard Chartered Bank (SCB), an existing MA, will continue to manage its existing CDAs until end 2018. Parents can continue to open CDAs with SCB until the second quarter of 20151 when DBS and UOB come on board.
MSF will also introduce a Baby Bonus Online system in the second quarter of 2015 to make it more convenient for parents to join the Scheme and open a CDA for their child. With the online system, parents will no longer need to fill up hardcopy forms and make a trip to the bank to open CDAs. Parents-to-be can join the Scheme, as early as 2 months before the estimated delivery date of their child.
Parents can expect to receive the cash gifts and have their CDAs set up within a shorter time of 7 to 10 working days of the child’s birth registration. The government matching will be received within a shorter time of 2 weeks after making deposits. They can also review their choice of MA and make changes online at their convenience.
More details on the Baby Bonus Online will be announced in 2015.
For enquiries on the Baby Bonus Scheme:
Baby Bonus Toll-free hotline: 1800-2537707 during office hours (Monday to Friday: 8.30am – 6.00pm).
Annex A - Baby Bonus Scheme
Annex B - FAQs
Annex C - Info-graphics
BABY BONUS SCHEME
First introduced in Apr 2001, the Baby Bonus Scheme (“Scheme”) has since been revised several rounds. The last revision was announced in Aug 2012.
Under the Scheme, the Government pays a cash gift to eligible children, in 3 instalments over 12 months. When parents open a Children Development Account (CDA) for their child, the Government also provides dollar-for-dollar matching contribution up to specified caps. Each child may only have one CDA.
A summary of the benefits is shown in Table 1.
Table 1: Total Baby Bonus Benefits
|Birth Order of Child
||Cash Gift from Government
||Maximum Matching Government Contribution
||Maximum Benefits Per Child
|1 and 2
||Up to $6,000
|3 and 4
||Up to $12,000
|5 and above
||Up to $18,000
FREQUENTLY ASKED QUESTIONS
- Why can't I transfer my CDA to the newly appointed bank now?
MSF and the newly appointed banks will need time to prepare their respective IT systems to manage CDAs.
- How will parents know which MA suits them better?
MAs will publicise their CDA benefits/terms from the last quarter of 2014 onwards.
- Do I have to pay for the transfer of my child’s CDA to another bank?
As a CDA holder, you will not have to pay any charges for change in CDA to another bank. If you have to forego any benefit/privilege/gift that had been given to you, the bank would have indicated such terms during account opening.
- My child’s CDA is with SCB and he will be 12 years of age by end 2018. Is there a need for me to switch my child’s CDA to another MA?
You do not need to switch your CDA with SCB to another MA by end 2018 if your child is turning 12 in the same year. 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.
- My child’s CDA is with SCB. What should I do since SCB will cease to be a MA by end 2018? Will an option be given to me to change MA before then?
You should transfer your child’s CDA from SCB to another managing agent before the end of 2018, using the Baby Bonus Online. You can take your time to consider and make the switch to the MA of your choice within this period.
- Why is SCB not one of the banks appointed to manage the CDAs from second quarter of 2015?
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 Bank and UOB.
- What are the benefits/terms in the tenders’ proposal?
The banks will publicise their CDA benefits/terms (for example, CDA interest rates) from October 14 onwards. In their publicity, they will indicate which of these benefits/terms will remain or change from time to time.
1 MSF will announce the exact date within the second quarter of 2015, in due course.
Download: Annex C - Infographics