DBS is also the first and only bank that recognises CPF payouts as part of income in the “Bank & Earn” space via the DBS multiplier, which helps seniors qualify for higher interest rates for their balances.
Currently, banks assess income for credit card applications based on salary, rental, and investment earnings, which include dividends and interest.
“While some may accept CPF LIFE payouts as income proof on a discretionary basis, the process remains lacking in transparency and assurance,” the bank says, elaborating that its decision would give seniors fairer access to credit options.
The decision follows the Monetary Authority of Singapore’s (MAS) confirmation that banks can consider CPF LIFE payouts as a valid source of income for retirees above 65 years old for new unsecured loan facilities, which include credit cards, if they pass the $15,000 annual income threshold.
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“By recognising the payouts as income, we’re making sure seniors continue to have fair access to credit and the cards’ accompanying privileges,” says Calvin Ong, head of consumer banking group, DBS Singapore, who pointed out that there are more than 900,000 Singaporean or permanent resident customers who are aged 65 and above.
“This move ensures banking remains accessible and meaningful for our senior customers, so they can enjoy a fulfilling retirement,” he adds
Seniors interested in using CPF LIFE payouts as proof of income for their credit card applications can go to any DBS or POSB branch and submit their CPF monthly payout history or personal bank statements showing CPF LIFE.
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OCBC bank has also done the same, and UOB intends to follow in the near future.
"The number of seniors applying for credit cards is generally low, as most retirees typically have credit cards already. However, we hope this announcement puts to ease any concerns seniors may have about getting access to credit even after they have stopped working," says Joseph Wong, managing director of consumer credit risk management in OCBC.
"With this change, more retirees will be able to benefit from the unmatched perks offered by UOB credit cards as they enjoy the fruits of their labours following retirement," says Jackquelyn Tan, group personal financial services in UOB.
