The Singapore Commercial Credit Bureau (SCCB), a subsidiary of Credit Bureau Asia (CBA) Limited, has reported a slight deterioration in payment performance for the 4Q2024. Slow payments rose for the first time since 2Q2023, with both prompt and slow payments accounting for just over two-fifths of total payment transactions.
The SCCB monitors over 2.4 million payment transactions contributed by local firms. Prompt payment refers to instances where 90% or more of total bills are paid within agreed terms, while slow payment indicates less than 50% of bills paid within terms. Partial payment falls between 50% and 90%.
While prompt payments saw a marginal decline, decreasing by 0.05 percentage points (ppts) q-o-q from 3Q2024 to 41.15% in the 4Q2024, y-o-y however, the transaction improved by 0.1 ppts in the period. Slow payments, on the other hand, increased by 0.05 ppts q-o-q to 44.05% in the 4Q2024, though this conversely fell 0.1 ppts y-o-y. Partial payments remained unchanged at 14.80% both q-o-q and y-o-y.
Sectoral trends
In the construction sector, slow payments increased for the third consecutive quarter in the 4Q2024. Slow payments rose marginally by 0.04 ppts q-o-q to 55.30%, while special trade contractors experienced the highest rise, with slow payments increasing by 0.12 ppts to 55.40%. Building construction delays also grew slightly, up by 0.06 ppts to 55.85%.
Meanwhile, heavy construction saw a slight improvement, with delays falling by 0.05 ppts q-o-q to 54.65% in the 4Q2024. On a y-o-y basis, slow payments in the construction sector decreased by 0.02 ppts to 55.30%.
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Similarly, slow payments among manufacturers have improved after two consecutive quarters of increase in the 4Q2024 due to a fall in payment delays by manufacturers of electronics, instruments and chemicals.
In the period, slow payments fell by 0.03 ppts q-o-q from 39.15% to 39.12%. Manufacturers of electronics saw the largest decrease, dipping 1.60 ppts q-o-q from 46.15% in the 3Q2024 to 44.55%. This is followed by manufacturers of instruments, which fell by 1.57 ppts from 46.52% in the 3Q2024 to 44.95% in the 4Q2024. Manufacturers of chemical products saw the third largest decrease, falling 1.47 ppts q-o-q from 46.92% to 45.45% in the 4Q2024.
Overall, on a y-o-y basis, slow payments among manufacturers rose by 0.10ppts from 39.02% in the 4Q2023 to 39.12% in the 4Q2024.
In the retail sector, slow payments climbed due to delays in general merchandise, fashion apparel, and food and beverage sectors. Overall, slow payments increased by 0.03 ppts q-o-q to 43.15% in the 4Q2024. Retailers of general merchandise registered the largest rise, with slow payments up by 1.83 ppts to 28.58%. Fashion apparel delays followed, increasing by 1.60 ppts q-o-q to 47.85% in the 4Q2024, while food and beverage delays rose by 1.27 ppts to 44.32% in the period. Despite these increases, y-o-y slow payments in the retail sector declined by 0.35 ppts to 42.55%.
In the services sector, slow payments experienced a slight deterioration in the 4Q2024, ending six consecutive quarters of improvement. This was driven by delays in consumer, educational, and recreation services.
Slow payments also rose by 0.2 ppts q-o-q to 42.55% in the 4Q2024. Consumer services saw the largest increase, up by 2.25 ppts to 43.45%, while educational services grew by 1.85 ppts to 37.35%. Meanwhile, recreation services delays rose by 1.62 ppts to 48.12% in the period. On a y-o-y basis, slow payments in the services sector fell slightly by 0.35 ppts to 42.55% in the 4Q2024.
Finally, in the wholesale trade sector, payment delays increased marginally due to both durable and non-durable goods. On a quarterly basis, payment delays rose by 0.05 ppts to 40.15%.
Slow payments by wholesalers of durable goods increased by 0.05 ppts to 40.05%, while delays by wholesalers of non-durable goods climbed by 0.05 ppts to 40.25%. Overall, slow payments in wholesale trade fell by 0.20 ppts y-o-y to 40.15% in 4Q2024.
From a sectoral perspective, the construction, retail, services and wholesale sectors have seen a y-o-y decrease in the average proportion of payment delays in 2024.
On the increase in slow payments, Audrey Chia, SCCB chief executive officer (CEO) says: “On the overall, however, local companies are still relatively in a better state compared to a year ago. The average payment delays have decreased after two consecutive years of increase in 2024. Moving into 2025, firms should continue to exercise more prudence in cashflow management in the months ahead.”
