Local firms' payment performance worsened in the second quarter after showing an improvement in the first three months, a report by the Singapore Commercial Credit Bureau (SCCB) noted yesterday.
The report also found that slow and partial payments accounted for over half of total payments in that period, due largely to a weak manufacturing sector.
A slow payment is when less than 50 per cent of a bill is paid within the agreed terms, a partial payment is when 50 to 90 per cent is paid within the agreed terms.
In the second quarter, slow payments edged up by 0.51 percentage point to 37.1 per cent. Year on year, they fell 0.08 percentage point from 37.18 per cent.
Partial payments also rose, by 1.74 percentage points to 13.45 per cent, from 11.71 per cent in the previous quarter. Year on year, they were up 0.18 percentage point from 13.27 per cent.
Meanwhile, prompt payments - when 90 per cent or more of a bill is paid - fell to 49.44 per cent, down 2.26 percentage points. Compared with the second quarter of last year, prompt payments slid 0.11 percentage point from 49.55 per cent.
The report showed that among five sectors, manufacturing saw the largest increase in slow payments, inching up 1.43 percentage points from 36.65 per cent in the first quarter. Year on year, slow payments dipped by 0.92 percentage point from 39 per cent.
The other sectors are construction, retail, services and wholesale.
Retail recorded the biggest quarter-on-quarter decline in slow payments, down 1.54 percentage points to 36.19 per cent.
Slow payments fell for the third consecutive quarter - from a decrease in such payments from retailers of general merchandise, food and beverage, building materials and garden supplies.
Year on year, however, retail saw the largest percentage increase in slow payments, up 6.35 percentage points from 29.84 per cent.
Slow payments for the wholesale industry fell the most among sectors year on year, down 1.72 percentage points to 35.22 per cent.
Quarter on quarter, delays edged up 0.97 percentage point to 35.22 per cent, from 34.25 per cent.
The construction sector saw slow payments improve slightly in the second quarter due to a decrease in payment delays primarily in building construction.
In the services sector, slow payments rose for the first time after four straight quarters of decline.
D&B Singapore chief executive Audrey Chia said the rise in slow payments for the second quarter was largely due to weaker performance within the manufacturing sector and the overall deterioration in credit conditions.
"On the external front, challenges remain as the wholesale trade sector continues to face headwinds. However, compared with the same quarter in the previous year, the increase in slow payments is relatively marginal," she added.
D&B compiles the figures by monitoring more than 1.6 million payment transactions of companies operating through its unit SCCB, which manages a database of local enterprises and their credit history.