SINGAPORE: From Oct 15, banks may hold or reject transfers from accounts with balances of at least S$50,000 if they result in over 50 per cent of the account balance being transferred out.

The safeguard will kick in if the threshold is met - that is, when a transaction, together with withdrawals over the past 24 hours, results in 50 per cent being moved.

The transaction that triggers the threshold and all subsequent transactions out of the account will either be held or rejected for 24 hours.

This applies to the current and savings accounts, including joint accounts, with the major retail banks - DBS, OCBC, UOB, Citibank, HSBC, Maybank and Standard Chartered - said the Association of Banks (ABS) on Friday (Oct 3).

This safeguard will apply to all digital banking transactions done through bank apps and internet banking. Non-digital banking transactions, including cash withdrawals at bank branches and ATMs, will not be affected.

"Customers may experience delays in digital payments and transfers, including for legitimate transactions, as banks step up their checks to protect customers," said ABS.

"Customers are advised to plan time-sensitive banking transactions (for example, for share purchases) in advance to avoid incurring fees and charges due to any delay."

When transactions are held or rejected, bank customers will be informed immediately on their mobile banking app or internet banking platform, with instructions on the next steps to take.

The 24-hour cooling period serves as a "cognitive break" for scam victims who initiated and authorised the transactions, said ABS.

"It provides time for victims to cancel the transaction should they subsequently realise that they have been scammed."

Banks will advise their customers on how to cancel transactions, including through mobile or internet banking or contact centre. Upon cancellation, the transaction will not be processed, and funds will remain in the victim's account.

Customers need not take any action if the transactions are legitimate, and their funds will automatically be released after the cooling period.

In exceptional cases where customers urgently need transactions to be processed during the cooling period, they will have to verify their transactions with the bank.

This can be done at the bank's branches, ATMs or by calling the contact centre, depending on the options offered by the bank.

When a legitimate transaction is rejected, customers can re-initiate the transaction if they subsequently verify it with their bank.

"As banks adopt different ways to engage customers to verify the legitimacy of transactions, they will be advising their customers accordingly," said ABS.

To minimise disruptions to legitimate transactions, some digital banking transactions will be exempted from the new safeguards.

These are recurring standing instructions, recurring GIRO or eGIRO payments, and bill payments to organisations classified by the bank as billing organisations.

Banks may hold, reject some transfers if more than half of an account's balance is moved out