Reply to Parliamentary Question on Number of Adult Singaporeans Not Having a Bank Account and Reasons for Not Having One

Published Date: 04 September 2020 the Monetary Authority of Singapore

QUESTION NO 15

NOTICE PAPER 12 OF 2020

FOR WRITTEN ANSWER

Date: For Parliament Sitting on 4 September 2020

Name and Constituency of Member of Parliament

Mr Chua Kheng Wee Louis, MP, Seng Kang GRC

Question:

To ask the Prime Minister (a) how many adult Singaporeans currently do not have a bank account; (b) what are the primary reasons for individuals not having a bank account; and (c) whether special bank accounts for Government transactions can be created through POSB for such individuals.

Answer by Mr Tharman Shanmugaratnam, Senior Minister and Minister in charge of MAS:

1.     It is estimated that over 98% of adult Singapore residents have bank accounts. In the recent Solidarity Payment payout, 98.7% of Singaporeans who received the payments had the amounts credited into their bank accounts. As for the remaining recipients, surveys showed that many also had bank accounts but preferred to collect the payouts in cash. 

2.     Notwithstanding this high level of banking access, to ensure that Singaporeans have access to affordable and convenient basic banking services, the three local banks, Citibank, HSBC, Maybank and Standard Chartered Bank already offer Basic Banking Accounts (BBAs) since 2002. Typically, such accounts come with ATM/debit card, internet banking and electronic payment services, and can be maintained at very low or even no cost. For instance, DBS/POSB does not set any initial deposit or minimum account balance and waives the $2 maintenance fee if the individual chooses to receive eStatements. The local banks also waive fall-below fees for specific customer segments such as children, the elderly and recipients of public assistance.

3.     However, some Singaporeans remain unbanked. This may be due to low awareness of the availability of BBAs, or by choice. The Monetary Authority of Singapore (MAS) has made clear its expectation that banks should provide accounts to individuals who want them. In some cases, where specific safeguards may be required to mitigate money laundering or terrorism financing risks, banks may offer accounts with more limited functionalities. There is a small number of individuals who have committed serious crimes related to sanctions imposed by the United Nations [1] who may not be able to open bank accounts. Banks have significant concerns in such cases, due to the difficulty of confirming the source of the customers’ funds or the legitimacy of transactions. MAS has been working with the banks to allow accounts to be opened for such individuals with enhanced due diligence and account restrictions.

4.     MAS is working with banks on further ways to enhance financial inclusion, while ensuring that risks are adequately managed. It is collaborating with the Ministry of Education, to ensure that all Singaporean children have bank accounts.

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1. [1] As a member state of the UN, Singapore is committed to implementing the UN Security Council Resolutions (UNSCRs), including the imposition of targeted financial sanctions against specific individuals and entities. Financial institutions, businesses and individuals in Singapore are required to comply with regulations issued under the MAS Act and UN Act, prohibiting them from dealing with these designated individuals and entities.