Singapore firms' payment performance deteriorate in Q3: SCCB

All sectors, excluding construction, saw a decline with trailing payments.

Singapore’s payment performance fell further in Q3, even with some slight improvements across certain sectors.

According to Singapore Commercial Credit Bureau, prompt payment accounted for less than two-fifths of total payment transactions while slow payment accounted for more than two-fifths of total payment transactions.

On a quarter-on-quarter (QoQ) basis, prompt payments have declined to a new low, down by 1.70% from 40.09% in Q2 to 38.39% in Q3. Year-on-year (YoY), prompt payments dropped significantly by 10.42% from 48.81% in Q3 2019 to 38.39% t in Q3.

Slow payments dipped slightly by 1.62% from 45.78% in Q2 to 44.16% in Q3. On the other hand, slow payments climbed by 6.87% YoY from 45.78% YoY in Q2 to 44.16% YoY in Q3.

Partial payments increased moderately by 3.32% from 14.13% in Q2 to 17.45% in Q3. Meanwhile, partial payments jumped by 3.54% YoY from 13.9% YoY in Q3 2019 to 17.45% YoY in Q3.

From a sectoral perspective, the construction sector saw the largest QoQ increase in payment delays, with a rise of 4.03% QoQ from 51.97% in Q2 to 56% in Q3. Special trade contractors saw the largest increase in slow payments, with 56.15% in Q3.

Slow payments within the building and heavy construction subsectors inched upwards by 1.11% reaching 56.65%, and 2.29% up to 55.2% in Q3, respectively. The sector rose significantly by 9.1% YoY, having 56% YoY in Q3.

The manufacturing sector increased slightly due to a fall in payment delays, inching upwards by 1.03% to 39.55% in Q3. Manufacturers of textile mill products, petroleum and coal, rubber, and plastics dropped significantly by 10.33%, 9.7%, and 7.71% respectively. Slow payments increased marginally by 0.33% YoY from 39.22% YoY in Q3 2019 to 39.55% YoY in Q3.

The retail sector also saw visible improvement in slow payments compared to the previous quarter. This is largely due to a fall in slow payments by retailers of general merchandise, food and beverage as well apparels and accessories, declining by 9.44%, 7.83%, and 5.66% respectively. On a YoY basis, slow payments climbed significantly by 7.83%, from 34.47% in Q3 2019 to 42.30% in Q3.

Slow payments within the services sector  also saw improvements due to a fall in payment delays by personal services (16.44%), educational services (6.45%) and health services (5.43%), with 6.71% QoQ, from 48.35% in Q2 to 41.64% in Q3. YoY, slow payments increased by 5.22% from 36.42% in Q3 2019 to 41.64% in Q3 2020.

Meanwhile, the wholesale trade sector saw a slight increase in payment delays primarily due to a jump in slow payments by wholesalers of both durable (3.02%) and non-durable (1.88%) goods. Payments jumped by 5.46% YoY, from 35.83% in Q2 2020 to 41.29% in Q3 2020.