Higher returns, more choice for Baby Bonus accounts

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FROM 1 Aug, parents can expect higher interest rates for their Baby Bonus Children Development Accounts (CDAs), said the Ministry of Community Development, Youth and Sports (MCYS).

The current CDA interest rate offered by DBS Bank is 0.25 per cent.

More details of the new rate, added MCYS, will be released in May.

CDAs, first implemented with the Baby Bonus scheme in 2001, are accounts into which the Government pays cash gifts and matching contributions of up to $18,000 each as an incentive for married couples to become parents.

In August, these parents can also choose from two new banks to manage their CDAs - OCBC Bank and Standard Chartered Bank.

DBS Bank will no longer provide such accounts from then.

All CDA holders, said MCYS, will also get a CDA-Nets card to give them the convenience of drawing on their CDA funds when they make payments at child care centres, kindergartens, special schools and other approved institutions.