The gloomy headlines concerning the economic position of Singapore in recent years will revolutionize in 2017 which will bring brighter prospects. These positive sentiments are restricted only to few sectors in the economy. Consumer credit maintained positive growth rates and is supported by increase in mortgages and credit card interest payments.
According to research report, “Consumer Lending in Singapore”, consumer lending conditions may tighten further along with efforts to control and risk in the financial systems. Regardless of the depressing economic position in Singapore, consumer lending maintained a positive growth rate in current terms. On a national perspective, there were increase in mortgages and credit card interest payments. Consumer credit lending has a current value growth but the number of incomplete loans saw a slower repayment option and total consumer credit outstanding balance declined.
The new private vehicle registrations increased when the government reduced restrictions on vehicle financing in 2015. This led to a strong growth in consumer auto lending. The year 2016 saw a positive recover in auto lending outstanding balance. However, a strong demand from app-based private rental cars, it slowed down the growth in car loans and consumer auto lending showed signs of slowdown in 2016.
Consumer lending is expected to see minimum value growth in 2016 due to the less positive economic outlook. The real GDP forecasts by analysts was disappointing and rising unemployment rate contributed to the sluggish forecast in consumer lending. The Singaporeans became more risk-adverse and avoided higher interest rates on consumer loans.
Consumer lending by Singapore banks strengthened in February 2017. However, weak lending growth to still haunt Singapore banks in 2017. The consumer lending growth varies between 1% to 2% for the year 2017. Latest banking data confirms that the analysts’ negative view on the financial sector shows declining growth to 11% and the asset quality continues to worsen. In general, the loan growth for the year 2018 will very much depend on the job market pickup. Business loans will continue to dip along with the uncertain economic environment.
According to research firm, Ken Research, consumer loan growth was steady, with total lending up 3% from November 2016. Housing and bridging loans increased drastically. Credit card lending increased and car loans dipped. The financial sector has taken a series of specific measures to strengthen financing channels for next-generation Asian growth companies and to build technology infrastructure to drive innovation.
Singapore aspires to be the financing hub for the next-generation companies. These companies range from small start-ups to medium enterprises or early-stage large enterprises and often have a strong focus on innovation or technology. In the coming years, the financial sector will work with industry players to study successful private market structures and engage potential platform and market operators to unlock capital so that they can go on to start new and innovative businesses.
The government has taken interest in developing Know-Your-Customer (KYC) utility. This is a process by which a financial institution identifies and verifies the credentials of their clients for any type of loan. This is a crucial process for all the financial services industry worldwide. The Singapore government is working closely to study the feasibility of developing an industry KYC utility that perform KYC processes on a centralised basis.
Key Topics Covered in the Report:
Consumer Lending In Singapore
Singapore Consumer Lending Sector
Singapore Financial Sector
Singapore Banking and Financial Market
Consumer Landing Forecast Singapore
Singapore Financial Sector Growth
Singapore Financial Sector Outlook
Singapore Financial Sector Development
Singapore Consumer Lending Sector Research
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Ankur Gupta, Head Marketing & Communications