Employee Contributions to Self-Help Groups in Singapore

Employees in Singapore may have noticed on their pay slips that there is a small monthly deduction from their wages under acronyms such as CDAC, MBMF, SINDA, or ECF.

CDAC, MBMF, SINDA, and ECF Funds are collectively known as Self-Help Group (SHG) funds. They are managed by associations representing the respective racial communities (Chinese, Muslim, Indian, and Eurasian) in Singapore. By default, all working employees in Singapore who are either citizens or permanent residents make monthly contributions to the SHG fund that corresponds to their race.

The SHGs Funds are as follow:


Chinese Development Assistance Council (CDAC) Fund, administered by CDAC for the purposes of supporting less successful individuals in the Chinese community.


Mosque Building and Mendaki Fund (MBMF), administered by Majlis Ugama Islam Singapura (MUIS) to help build or upgrade mosques, develop educational and social programmes for Malay/Muslim families, and support their religious education needs.


Singapore Indian Development Association (SINDA) Fund, administered by SINDA to uplift the Indian community by offering a range of programmes and services to help families that require assistance.


Eurasian Community Fund (ECF), administered by the Eurasian Association (EA) to support Eurasians, people who are of European ancestry or simply those whose identity card identifies them as Eurasians.

These funds go towards uplifting the less privileged and low-income households in the Chinese, Muslim, Indian, and Eurasian communities respectively.

Contribution Rates

The contribution rates for the various funds differ from each other.

Are these contributions mandatory?

The Central Provident Fund (CPF) Board is the collecting agent for contributions to these SHG funds and by default, employers are expected to deduct the amounts stated above from employees’ wages each month. However, these donations are not compulsory. If an employee wishes to opt out of this scheme, they may do so by approaching their corresponding SHG and filling out a form. Once the form receives the endorsement of their employer and is submitted, the deduction will stop.

As contributions to these funds are on a per employment basis, one will need to submit a new Opt Out Form every time they change jobs so that their new employer can take note not to make this deduction.


Navigating through this scheme requires care

Its charitable merits notwithstanding, as a government initiative, this donation may not be mandatorily imposed but has certainly been designed in a way that makes it a hassle to avoid.

Employers in particular must be aware of their obligations both in making the automatic deductions for employees and in cooperating with the employees who have gone to the trouble of opting out. Given that employees can have many different contributions rates depending on their race and income level, it can be difficult for towkays to keep track. Adopting the right payroll software would go a long way to help with the fulfilment of this obligation.

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