Financial security is a key concern of workers. The Labour Movement has been helping workers and members to enhance their financial security in two areas; insurance (through NTUC Income), and savings (through NTUC Thrift and NTUC-OCBC Starter Accounts).
In the area of savings, the Labour Movement set up NTUC Thrift and Loan Co-operative Limited (NTUC Thrift) in 1998 to encourage union members to save and be financially prudent. Union members have benefited from various programmes such as bonus savers schemes and attractive interest rates. NTUC Thrift currently has about 29,000 customers.
In 2004, the Labour Movement partnered with OCBC Bank to further meet this need and expand the range of options for union members beyond just savings. Jointly, they developed a suite of basic banking products tailored for union members such as special credit/debit cards, general insurance, and the NTUC-OCBC Starter Account.
The NTUC-OCBC Starter Account, a savings product which gives union members up to 8 times higher interest than comparable savings accounts, has been especially popular. Since 2010, on a yearly basis, account membership of the NTUC-OCBC Starter Account has been growing by 15% on average, and members’ savings have been increasing by over 30%.
In view of this, NTUC Enterprise, the majority owner of NTUC Thrift, has reviewed the savings offerings to union members and decided to streamline efforts through the NTUC-OCBC Starter Account, and to exit the thrift and loans business. The NTUC-OCBC Starter Account has and can continue to offer higher interest rates to union members. The interest rate of the NTUC-OCBC Starter Account is now 0.20% p.a. for balances up to S$50,000 and 0.40% p.a. for balances between S$50,001 and S$500,000. In addition the bank is more accessible and delivers better service through its call centre, Internet, Mobile, network of branches and ATMs.
More than 150,000 union members currently hold the NTUC-OCBC Starter Account. This is significantly more than the 29,000 customers saving under NTUC Thrift. Also, union members save more in the NTUC-OCBC Starter Account than in the Thrift account. In fact, the average savings per union member in the NTUC-OCBC Starter Account is more than six times that in the Thrift account.
Said Chairman, NTUC Enterprise, Mr Lim Boon Heng “Our primary concern is how best to serve the needs of the union members. We can either do it ourselves, or through partnerships, but our focus is always on the member. In 1998, NTUC set up NTUC Thrift to encourage workers to be thrifty and to save. This purpose can now be better met through our partnership with OCBC Bank. More union members are saving through OCBC Bank than NTUC Thrift. Union members are also saving significantly more through OCBC Bank than NTUC Thrift. The streamlining is logical and in line with member preferences. We expect membership of the NTUC-OCBC Starter Account to increase from 150,000 today to over 220,000 by 2015.”
NTUC Thrift will be encouraging its members to transfer their funds to the NTUC-OCBC Starter Account to enjoy higher interest rates and better convenience. Members can also choose to withdraw and transfer their funds to other banks or credit co-operatives of their choice. NTUC Thrift has sufficient funds to meet obligations to all its members; the majority of whom are expected to have their funds transferred within the first quarter of 2013.
NTUC Thrift has informed its eleven employees of its decision. In collaboration with the Singapore Manual & Mercantile Workers’ Union (SMMWU), NTUC Thrift has offered all employees a compensation package in accordance with the terms set out in the Collective Agreement. Additional benefits will be given to further recognize employees’ contributions, along with support on new employment either within the Labour Movement or externally with the help of the Employment and Employability Institute (e2i). NTUC Thrift will also fully sponsor employees who need additional employment support, for example resume writing and interview skills training. The other Labour Movement social enterprises will also consider the staff for possible jobs.
Said Mr Lim, “NTUC Enterprise remains committed as a family of Social Enterprises to our mission of supporting working families. I would like to thank all unions, union members and staff for their strong support of NTUC Thrift over the years. NTUC Enterprise will continue to support workers and union members to enhance their financial security through NTUC Income and the NTUC-OCBC collaboration.”
END
