SINGAPORE - The payment performance of local firms improved from an all-time low in 2016, with the annual average proportion of prompt payments rising from 43.77 per cent to 48.40 per cent in 2017.
According to the Singapore Commercial Credit Bureau (SCCB), the annual average proportion of slow payments fell by five percentage points from 44.71 per cent in 2016 to 39.71 per cent in 2017.
Partial payments rose to a seven-year high in 2017, from 11.52 per cent in 2016 to 11.87 per cent in 2017.
Prompt payment refers to when 90 per cent or more of total bills are paid within the agreed payment terms. Slow payment refers to when less than 50 per cent of total bills are paid, and partial payment is when between 50 per cent and 90 per cent of total bills are paid.
The quarterly statistics for Q4 2017 also showed signs of improvement as prompt payments accounted for about 50 per cent of all payment transactions, while slow payments fell to nearly one-third of all payment transactions.
Compared to the previous quarter, prompt payments rose by nearly three percentage points from 47.43 per cent in Q3 2017 to 50.40 per cent in Q4 2017. When comparing to Q416, prompt payments rose by around 4.5 percentage points from 45.87 per cent in Q4 2016 to 50.40 per cent in Q4 2017.
Slow payments fell by some 3.8 percentage points from 40.75 per cent in Q3 2017 to 36.92 per cent in Q4 2017. Year on year, slow payments dropped by nearly 6.4 percentage points from 43.28 per cent in Q4 2016 to 36.92 per cent in Q4 2017.
Meanwhile, partial payments edged up by nearly one percentage point from 11.82 per cent in Q3 2017 to 12.68 per cent in Q4 2017, hitting a new high. When comparing year on year, partial payments climbed by some 1.8 percentage points from 10.85 per cent in Q4 2016 to 12.68 per cent in Q4 2017.
Based on industry, quarter-on-quarter slow payments improved across the board. Compared to Q3 2017, only one industry - construction - experienced a deterioration in slow payments in Q4 2017. The construction sector continues to experience the highest proportion of payment delays for the eighth consecutive quarter.
Audrey Chia, D&B Singapore's chief executive said: "Despite the cashflow woes experienced by local firms, we are seeing more firms fulfilling their debt obligations partially if not fully. Partial payments are always better than non-payments. This reflects a healthy sign that firms are exercising better credit vigilance and putting stringent controls in place to ensure they remain creditworthy in the eyes of their credits and not to default completely on their debts."
SCCB operates under D&B Singapore.