5-Day Clearing Week
The 5-Day Clearing Week (5DCW) means that on Saturdays, there will be no crediting or debiting of customer accounts with cheques, GIRO or Interbank funds transfers. Therefore, clearing of funds will be from Mondays – Fridays only. This change will take effect from 15 May 2006.
1. What will be the changes in cheque clearing and banking transactions on Saturdays when the 5DCW is implemented?
(A) Cheques:
- For cheques deposited on Fridays after cut-off time and on Saturdays – funds will only be available on Tuesdays after 2pm.
- For cheques deposited on Fridays before cut-off time – funds will be available on Mondays after 2pm.
- For cheques deposited on Thursdays after cut-off time – funds will only be available on Mondays after 2pm as these cheques will be deemed as Friday cheques.
| Cheque deposited on |
Funds available |
| Thursday (before cutoff time) |
Friday (after 2pm) |
| Thursday (after cutoff time) |
Monday (after 2pm) |
| Friday (before cutoff time) |
Monday (after 2pm) |
| Friday (after cutoff time) |
Tuesday (after 2pm) |
| Saturday |
Tuesday (after 2pm) |
(B) Saturday Branch Banking:
For banks that provide branch banking on Saturdays:
- Cheques will be accepted for deposit but funds will be made available only on Tuesdays after 2pm.
- Cash cheques can be en-cashed at the drawer’s bank.
- Cheques for deposit into an account may be marked and drawn on, provided both the payee and the drawer are from the same bank. (A handling fee will be charged for this).
(C) GIRO/ Standing Instruction:
No crediting or debiting of customer accounts on Saturdays via GIRO.
(D) Electronic Banking Services (eg ATM, Internet Banking and Phone Banking):
As with usual practice, customers can transfer funds from one account to another account within the same bank on Saturdays (and Sundays too).
2. Will all cheques issued be affected by this new move?
Only Singapore Dollar cheques drawn on banks in Singapore will be affected.
3. Will all banks that issue and receive cheques in Singapore be involved?
Yes.
RATIONALE & MITIGATING MEASURES
4. Reasons for a 5DCW
This move is in line with practices in leading financial centres like the US, UK, Switzerland, Germany and Australia where there are no payment clearing facilities on Saturdays. Asian countries that do not have Saturday clearing include Thailand, China and Indonesia. It is also in line with the present move towards a 5-day work week among many companies in Singapore.
5. Is the real reason to save costs for banks?
No. In fact, the move to a 5DCW will result initially in greater investments by banks in Singapore to change their present operational systems to provide for the additional resources to cater for the longer cheque deposit cut-off times for Thursdays and Fridays.
6. How will customers be impacted with this change?
The debiting and crediting of customers’ accounts with cheques, GIRO or Interbank funds transfers currently done on Saturdays will be postponed to the next business days, on the following Mondays or Tuesdays.
Funds from cheques deposited on Fridays will be made available later when the 5DCW is implemented compared to the present clearing arrangement. However, measures can be taken to alleviate this.
7. Won’t it result in inconvenience for customers?
Yes, we recognise that this move will cause some minor changes to banking routine of some customers initially. In particular, to those who currently need to have funds made available to them on Saturdays.
It is expected that over time, these customers will be able to adjust their cashflow needs accordingly.
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