What in the world is SGFindex and why should I share my financial info with the banks? Don’t they already have my information?
You may have come across the option to connect your bank account to SGFinDex or perhaps your bank relationship manager has encouraged you to connect it in order to retrieve information more easily for various applications like loans or credit cards.
But what exactly is SGFinDex and what are the benefits or implications of connecting it to your bank accounts?
Just recently DBS also annouced that it has added SGFindex as a way to earn bonus interest for the DBS Multiplier account.
What Is SGFindex?
The term SGFindex actually stands for Singapore Financial Data Exchange which actually connects a national digital identity (SingPass) to your financial data such as CPF, IRAS assessable income, home loans, bank account balances and more.
In essence, it is a MAS initiated digital infrastructure that allows the approved organization to retrieve your financial data from various Government agencies via MyInfo.
When you connect via SGFindex to say your DBS account, you are allowing DBS to retrieve financial records from other sources that you have connected to SGFindex and they will be able to read your data.
SGFindex is not an automatic opt-in. It is up to you to give consent whether or not an approved organizations can retrieve your data, and you can cancel the connection at any time you wish.
What Data Can Be Retrieved?
- CPF balances
- IRAS past year assessable income
- HDB home loan balance
- Bank account balances
- Credit card info and balances
- Loans (like personal loans, car loans, etc)
- Fixed deposit
- Unit trust data
- CPF Investment Scheme (CPFIS)
- Supplementary Retirement Savings (SRS)
This list is accurate As of Sept 2023.
How Secure Is SGFindex?
There are stringent security measures in place to safeguard your personal data that passes
Your data is encrypted when it is retrieved through SGFinDex and only the financial planning application/website(s) that you have authorised to receive your data is able to decrypt the data. The authentication and authorisation process is underpinned by Singpass.
Legally, the data retrieved from SGFinDex is also covered under the Public Sector (Governance) Act as well as Personal Data Protection Act (PDPA). This means that any organization that is in breach of data protection or officers that misuse the data shall be subject to regulatory action.
What Are the Main Implications Of Connecting Your Account?
Before you connnect SGFinDex it’s important to consider what is the purpose – don’t connect just for the sake of it!
Let’s explore the example of connecting SGFinDex to your DBS Multiplier account.
Upon connection, what this means is that DBS is now able to access your financial information such as your balances in other bank accounts, credit card balances, loans, CPF and HDB loans.
💡Know the Implications
Banks traditionally do not have access to data of your other bank account balances and loans held in other banks. For example, DBS does not know that you have $100k sitting in your UOB One account.
By granting access to retrieval of data via SGFinDex, DBS is now able to have a clearer financial picture of your “wealth” standing and can more easily review any applications.
What Are The Benefits of Connecting SGFinDex?
Ease of data retrieval
Let’s say you want to increase your credit limit for a DBS credit card, but most of your savings and salary is kept in a UOB One account instead of DBS.
Instead of having to go through the tedious process of furnishing proof of income, bank statements and other required details to increase your credit limit, you can instead connect SGFinDex in minutes to retrieve your financial data for the credit limit review.
DBS Multiplier – Connect to earn higher interest rate tier
Instead of crediting salary to your bank account, you can now link your DBS Multiplier to SGFinDex on DBS NAV Planner.
For self-employed people, these is actually really useful as many self-employed persons are unable to meet the salary criteria to enjoy the higher interest rate multipliers.
Do note that SGFinDex on the DBS NAV Planner needs to be synced every month to qualify as an activity.
You want to view all of your financial details in one glance
The DBS NAV Planner is a pretty neat tool that allows you to view information from banks, insurers, CPF HDB and IRAS in one dashboard. If this is something helpful for you in your financial planning, you can consider this as well.
When should you not connect SGFinDex?
Here are some other scenarios where connecting SGFinDex may also not work in your favor.
Remember that you are the guardian of your data, and have the final say whether or not you wish to share this sensitive infromation with organizations.
Don’t Want Banks to Have Access to All Your Financial Data
There are people I have come across that just do not like the notion of allowing financial insitutions too much access to their data.
It’s true that once you connect, banks will have a better understanding of your financial picture. But they also gain alot of information about you that they didn’t have before. These means that they will also have a better idea of how to market financial products to you based on a more comprehensive overview.
Sharing a personal experience, I had most of my cash stored in other bank accounts with higher interest and only maintained a small sum in my DBS Multiplier. Within 3 days of connecting my SGFinDex to DBS, I was contacted by a DBS relationship manager to come in for a “review” of how to optimize interest for my bank account which turned out to be a pitch for an investment linked product.
Of course this event may not be 100% related, but the fact of the matter is that the bank now knows that I have more money stored elsewhere.
If you are looking to avoid these marketing calls or just want to keep your balances private, perhaps it might be in your best interest not to allow access to too much of your financial data.
When You Have Debt In Other Accounts
Let’s say you want to take a housing loan from DBS bank but already have a car loan with UOB and a personal loan from OCBC.
In this case, connecting SGFinDex will allow DBS to retreive this data and know that you still have multiple loans that have yet to be paid off. This may have an impact on how much loan amount they will be willing to lend to you.
Same thing if you have yet to fully pay off credit card debt, your credit score and ultimately, the loan quantum may be affected.
⚠️ Note that the above scenario is not a very financially prudent situation and one should always aspire to avoid taking on too much debt in their personal capacity.
However these are just some suggested scenarios where banks not having full access to too much of your financial data may work in your favor.
Ultimately you should decide if allowing the organization to retrieve your financial infromation will benefit your current position.
How to Connect SGFindex?
It’s actually very simple to connect your bank account and the entire process can be done in a matter of minutes.
All you have to do is log in to your banking app of the participating organization and navigate to the SGFindex connection tab. For example DBS SGFindex.
You will be prompted to login via Singpass and authenticate the connection.
Which Banks/Organizations Can Be Connected?
All entities that wish to pull data via SGFinDex must first be approved by MAS. At the time of writing, there are 7 approved banks.
If you are in doubt so to whether or not the organization requesting for the connection is approved by MAS, do head over to the SGFinDex website to confirm.