CASHLESS PAYMENTS (Progress report)

Mr Heng Chiang Meng asked the Minister for Finance what is the success of the policy on cashless payments as measured by some broad indicators such as the breakdown of payments by GIRO/interbank GIRO, cheques and cash for income and property taxes, Public Utilities Board bills, Telecommunication Authority of Singapore bills, etc., and whether he will encourage greater participation in electronic payments by financial incentives for those using such methods of payment.

The Minister for Finance (Dr Richard Hu Tsu Tau): Mr Speaker, Sir, since January 1984, cashless means have been encouraged in the payment of Government fees, salaries and all commercial transactions.

In January 1984, about 41% of workers numbering 411,000 were paid through their bank accounts. By July 1986, this figure has risen to about 78% or 766,000. This represents an increase of 86% over the period.

In January 1984, there were 410,000 GIRO and Interbank GIRO accounts representing about 11% of the total with Government departments and agencies. This rose to 1.1 million by July 1986, or about 25% of the total, an increase of 168%.

To promote cashless payments in the retail sector, about 500 EFTPOS (Electronic Fund Transfers at Point of Sale) terminals were installed at retail outlets by July 1986.

Presently, incentives already exist to pay through cashless means such as GIRO. This includes a reduction in the deposit payable for Public Utilities Board bills and allowing instalment payment of property tax and income tax to be spread over the whole year.

Overall, I am satisfied with the progress made in persuading the general public to adopt cashless means of payment, particularly through electronic fund transfers. As such, it appears unnecessary for me to introduce financial incentives at this time.