SLOW payments among Singapore firms increased for the third consecutive quarter, led by the retail and services sectors, according to a report by the Singapore Commercial Credit Bureau (SCCB) on Tuesday.
Slow payments climbed 2.46 percentage points to 39.75 per cent in the fourth quarter of 2019 from 37.29 per cent in the third quarter. Slow payment is when less than 50 per cent of total bills are paid within the agreed terms.
Quarter on quarter, four out of five sectors reported more slow payment.
Slow payments in retail rose the most, up 4.33 percentage points to 38.8 per cent from 34.47 per cent, due largely to a rise in payment delays by retailers of general merchandise, automobiles, and furniture and home finishing, said SCCB.
In the services sector, slow payments saw a 3.49 percentage points increase to 39.91 per cent from 36.42 per cent. SCCB attributed the increase 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 in manufacturing, it decreased by 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.
Prompt payment refers to when 90 per cent or more 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 due largely to increased payment delays in the retail and services sector, partial payments have hit a new peak within the past year, said 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, through the SCCB, more than 1.6 million payment transactions of firms.