Last Updated on June 26, 2023 by Parentology

Using the CDA

The Child Development Account is one of the benefits of the Baby Bonus Scheme, released by the MSF as part of the Marriage and Parenthood Package. It is a bank account that is established automatically for parents who register their children for the Baby Bonus Scheme (this can be done online) and comes with two main benefits.

The first is the cash gift provided when the account is opened – a one-time gift of $3,000 per account (that is, per child). The second is the government co-matching that is associated with the account. Depending on the birth order of your child, the government will match every dollar that you save into the account up to a certain amount, which means that the money you save into the Child Development Account is effectively doubled.

To that end, there are a lot of questions on how the Child Development Account can be used – ranging from whether they can be used in conjunction with specific schemes and what they can be paid for. These minute details are what this article aims to cover.

 

Applying for the account

The Child Development Account, as mentioned, is a government-sanctioned account type that is managed by three banks – DBS, UOB, or OCBC. It is held jointly in the name of the child as well as the nominated trustee for the account – an adult above eighteen who is not bankrupt and who will manage the funds of the account.

The cash gift is deposited within 2 weeks of account opening, and can immediately be used without initial and additional deposits from the CDA trustee. You also do not need to wait for any government co-matching contributions to be deposited into the account before you use anything – in short, as long as there are funds in the account from deposits, cash gifts, or co-matching, you can use the CDA!

Government co-matching will continue until you either reach the cap (dependent on birth order – do check your child’s cap on Baby Bonus Online) or the account is closed on 31 December of the year that they turn 12.

 

Payments and withdrawals from the account

Payments from the Child Development Account can be made via NETS or GIRO. NETS is a straightforward process – you can simply use the NETS card with the PIN that you have set, and follow the instructions from the Approved Institution to swipe the card for payment. For GIRO, you will need to submit an authorisation form to the Approved Institution, and the process may vary slightly from AI to AI. Do note that this process takes much longer – around several weeks – compared to NETS. As such, if it is time-sensitive, you may need to use NETS instead if the Approved Institution has signed up for the NETS service.

If you need to reset the PIN because you have forgotten, you will need to approach the individual bank under which the CDA is set up, and follow their process for resetting the PIN. If you have not used the CDA NETS card for some time, you may need to return to the relevant bank to reactivate the card.

You will not be able to make withdrawals from the account. This is to ensure that your child’s funds are specifically dedicated to their education and healthcare, and so that they cannot be otherwise misused.

 

What can I use the Child Development Account’s funds on?

In general, you can use them on healthcare- and education-related funds from Approved Institutions (AIs). Approved Institutions can be identified on Baby Bonus Online, or via the Baby Bonus sticker they may sometimes have on their premises; if unsure, you can also ask them whether they are a Baby Bonus Approved Institution.

You can use the CDA funds for the child whose name it is in, as well as their siblings. To use them for their siblings you will need to produce the relevant birth certificates for your children as well as follow any other guidelines from the Approved Institution.

You can also use them on certain insurance premiums, although these are limited to those that fall distinctly within MediSave guidelines (MediSave-approved Integrated Shield Plans), and will not be applicable to riders. Currently, Great Eastern is the only institution approved for ISP purchases through the CDA via GIRO.

You can, however, make purchases of private insurance outside of the CDA – that is, paying with another bank account first – and then appeal for reimbursement through CDA. To do this, you will need to go ahead and pay for the insurance first before sending an appeal email to msf_babybonus@msf.gov.sg with supporting documents (e.g. insurance documents). Do note that if the premium is deducted from the MediSave account you will not be able to make an appeal.

Payments that were originally made in cash cannot be refunded to the CDA either; you will only receive refunds in cash. Payments that were made via the CDA can only be refunded to the CDA as well – note that refunds do not qualify for government co-matching. You can continue to save funds into the account and receive co-matching, and when the account is closed a certain amount will be transferred over to a new account – the Post-Secondary Education Account (PSEA) that is automatically opened under the jurisdiction of the Ministry of Education. Any excess funds that are not transferred into the PSEA will be refunded back to the nominated bank account listed under Baby Bonus Online.

You can continue saving with the PSEA, and once again the government will co-match until the cap is reached or the child turns 18.

 

Healthcare

You can use the CDA card and the CHAS (Community Health Assistance Scheme) card in one transaction, as they are actually catering for different purposes. CHAS allows all citizens to receive medical and dental care at various medical institutions across Singapore, including General Practitioners (GPs). You will need to ask your specific Approved Institution how they manage this combination.

 

Education

The funds from the Child Development Account can be used to pay for items relating to childcare centres and educational institutions. For instance, they can be used to pay registration fees for childcare centres and kindergartens as long as the institution is an Approved Institution. Most AIs will collect these fees via GIRO or NETS, with GIRO being the more common option; in this case, you will need to be aware that GIRO payments take six weeks to process. As some AIs require payment to be completed to secure placements in their centres, you may want to check what their policies are. As mentioned, if you want to secure placement you may always pay in cash first and request an appeal later. NETS payments are immediate.

Unfortunately, CDA funds will likely not be applicable for additional enrichment programmes unless they are held by Approved Institutions, and are also not applicable for primary and secondary school fees.

 

Health and Education Summary Table

Here is a categorisation of the types of approved expenses from various Approved Institutions, as sourced from the MSF website:

• Fees related to early childhood development centres (ECDCs), including childcare centres, preschools, special education institutions, or early intervention programmes if applicable. The following are included:

		ECDC (Class A or B licence); MOE kindergarten care	ECDC (Class C licence); preschools registered with CPE as Private Education Institution; MOE kindergartens	SPED schools (Registered with MOE / CPE)	Early intervention programme (Registered with MSF/ECDA)
1	Uniforms and attire	Yes	Yes	Yes	Yes
2	Insurance	Yes	Yes	Yes	Yes
3	Registration fee	Yes	Yes	N.A.	Yes
4	Bedding materials	Yes	N.A.	N.A.	Yes
5	Materials / books	N.A.	Yes	Yes	Yes
6	Local excursion / field trips and virtual field trips	Yes	Yes	Yes	Yes
7	Transport	Yes	Yes	Yes	Yes
8	Deposit (must be refunded back into CDA)	Yes	Yes	N.A.	Yes
9	Examination / assessment fees	N.A.	N.A.	Yes	Yes
10	MSF-funded Early Intervention Programmes (Learning Support, Development Support, and Development Support-Plus)	Yes	Yes	N.A.	N.A.
11	E-learning management system / online parent communication system	Yes	Yes	N.A.	N.A.
12	Meals during programme time	N.A.	Yes	N.A.	N.A.

 

• Hospital and clinic expenses (this may overlap with CHAS; speak to the relevant Approved Institution about it)
• Insurance premiums for MediSave-approved Integrated Shield Plans (ISPs). Note that this does not apply to riders and that Great Eastern is currently the only Approved Institution for CDA.
• Pharmaceutical expenses, including medication, surgical products, OTC medication, dermatological products, and nutritional supplements (e.g. vitamins).
• Ophthalmological expenses, including spectacles (glasses), contact lenses, eye care products, and services from an optometrist or optician registered with the local Optometrist and Opticians Board
• Assistive Technology Devices (ATDs) and their accessories (e.g. hearing aids, wheelchairs, Braille electronics), as well as services related to buying, maintaining, rental or loan of these devices

 

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