Slow payments among Singapore firms increased for the third consecutive quarter, led by the retail and service sectors, said a report by the Singapore Commercial Credit Bureau (SCCB) yesterday.
Slow payments climbed 2.46 percentage points to 39.75 per cent in the fourth quarter of last year from 37.29 per cent in the third quarter. The term refers to situations when less than 50 per cent of total bills are paid within the agreed terms.
On a quarterly basis, four out of five sectors reported more slow payments.
The retail industry saw the biggest rise, up 4.33 percentage points to 38.8 per cent from 34.47 per cent, due largely to a rise in payment delays by sellers of general merchandise, automobiles as well as furniture and home finishing.
In the service sector, the rise in slow payments was 3.49 percentage points, to 39.91 per cent from 36.42 per cent. SCCB attributed it to a rise in payment delays within consumer services, recreational and social services sub-segments.
Slow payments in construction went up 2.52 percentage points to 49.42 per cent from 46.90 per cent, due mainly to a rise in payment delays by special trade contractors.
Slow payments in wholesale trade inched up 0.96 percentage point while manufacturing saw a drop of 0.09 percentage point.
Overall, prompt payments also fell for a third consecutive quarter, down 2.58 percentage points to 46.23 per cent in the fourth quarter from 48.81 per cent in the third quarter.
Partial payments inched up 0.11 percentage point to 14.02 per cent from 13.91 per cent.
Percentage of slow payments in the fourth quarter of last year, from 37.29 per cent in the third quarter.
Prompt payment refers to when over 90 per cent of total bills are paid within the agreed payment terms, while partial payment refers to when between 50 and 90 per cent of total bills are paid within the agreed payment terms.
While payment performance has continued to deteriorate - largely due to increased payment delays in the retail and service sectors - partial payments have hit a new peak within the past year, said Ms Audrey Chia, chief executive officer of D&B Singapore.
"This is a sign of companies taking steps to ensure that they remain creditworthy in the eyes of their creditors and not deferring their payments entirely," she added.
D&B Singapore compiled the study figures by monitoring more than 1.6 million payment transactions made by firms.
THE BUSINESS TIMES