From 1 January 2019, employers of foreign domestic workers (FDW) in Singapore are no longer allowed to safe keep any money belonging to their maid including the salary in order to protect both parties from money-related disputes. Therefore, opening a bank account for your maid will be one of the best ways for both you and the maid to manage her money.
Benefits of maids having a bank account
Avoiding salary-related disputes
Employers can set up auto-transfer instruction to ensure their maid's salary is transferred on time every month. In addition, the maid can keep track of salary payments and thus it undeniably helps to curb the number of payment disputes.
Safety is also a big advantage as bank accounts ensure the protection of the money – especially from thefts and accidents.
Personal finance management
Accessibility is another great advantage as banking makes it possible for the maid to withdraw just the right amount that she needs, whenever she needs it – reducing the amount of cash she carries.
Some employers worry that maids may lack discipline if they do not safe keep the salary for the maid. The maid may spend all the funds and will turn to money lenders in the end. In fact, there are NGOs in Singapore that provide FDWs with financial literacy courses. Maids can learn how to budget and spend money wisely.
Available FDW bank account opening options
If you are considering opening a bank account for your foreign domestic worker in Singapore, have a closer look at the following options that are definitely interesting for FDWs given the advantages they offer.
OCBC Monthly Savings Account has a minimum monthly balance of S$50 for foreign workers who are S pass or employment pass holders. FDW to open a monthly savings account with OCBC requires to maintain a minimum monthly amount of S$1,000 or more or else a charge of S$2 is imposed by the bank.
POSB Payroll Account (FDW)
POSB Payroll Account (FDW) offered by DBS Bank also does not require an initial deposit. There is also no minimum average daily balance to be maintained each month (refer to notes for terms and conditions). For work permit applications submitted from 7 October 2018, employers of domestic workers can apply for the POSB Payroll Account (FDW) on their maid's behalf when they request for issuance of a work permit via mom.gov.sg/fdw-eservices.
The Centre of Domestic Employees also assists foreign domestic workers to open a POSB Payroll Account (FDW). The account opening is facilitated at the CDE's branches.
There are other banks in Singapore offering saving accounts with a low minimum average daily balance. Alternatively, you can check with your bank to see if they offer services for FDWs.