For the Parliament Sitting on 2 March 2022

Name and Constituency of MP
Gerald Giam Yean Song, Aljunied GRC

Question
Several residents have approached me for assistance to open bank accounts. They had been rejected by banks because of their implication in financial crimes.

They have turned over a new leaf and found honest jobs. However, they are unable to open a bank account for their salary deposits. Employers do not usually agree to deposit into their family members bank accounts and are unwilling to pay them in cash. They are also unable to receive Government cash benefits like GST Vouchers.

I understand MAS has been working with the larger retail banks to enhance financial inclusion by opening limited-purpose bank accounts for individuals whom the banks assess pose a higher risk of being implicated in financial crimes. What will be the functions of these limited-purpose bank accounts?

When will these limited-purpose bank accounts be generally available, and will they be extended to ex-offenders, persons under investigation or those undergoing a trial?

Answer by Mr Lawrence Wong, Deputy Chairman of MAS and Minister for Finance, on behalf of Mr Tharman Shanmugaratnam, Senior Minister and Minister in charge of MAS:

1 Last year, MAS engaged the major retail banksFor reference, the banks participating in the pilot are DBS, OCBC, UOB, Maybank, Standard Chartered, HSBC and Citibank. on initiatives to enhance financial inclusion for ex-offenders. Since January this year, the banks have been offering, as part of a pilot exercise, limited purpose bank accounts to persons whom banks have assessed may pose higher risks of being implicated in financial crimes, including ex-offenders and those under investigations or pending charges for financial crimes. The pilot exercise will allow banks a chance to obtain feedback and refine the product before the accounts are officially launched in the second half of this year. 

2 The functionalities and safeguards for limited purpose bank accounts are designed to enable individuals to meet their basic banking needs, such as receiving salaries and paying bills. To mitigate risks of abuse, the accounts are subjected to enhanced monitoring measures. For example, banks will check that individuals are only receiving funds from specified sources which had been agreed upon at account-opening, including salary payments from employers, government disbursements, and insurance pay-outs. These functionalities and safeguards will be adjusted as necessary after the current pilot. 

3 The limited purpose bank accounts will address the needs of most ex-offenders and persons under investigations or facing charges. However, there may be a small number of individuals whom banks have assessed to pose unacceptable risks. For example, individuals who have committed serious crimes involving the violation of targeted financial sanctions.  

4 MAS will continue to work with the Singapore Police Force on further ways to enable financial inclusion for individuals who have been involved in financial crimes, while ensuring that risks are properly managed.