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SINGAPORE: The good times might still be here, but some Singaporeans are biting off more than they can chew.
After falling from a high four years ago, the downward trend of bankruptcy petitions and orders is showing signs of reversing, while the delinquency rate for credit cardholders is creeping up. Another sign that Singaporeans could be facing cash-flow woes: Pawnshops are enjoying brisk business.
ValueMax Group operations manager Yeah Lee Ching said some people run out of cash before the next payday. "They pawn their items to tide over the last week of the month and redeem their items after they get next month's pay."
Noting that nine in 10 customers redeem their items, she added: "These are not poor people. They own gold, diamonds and expensive watches."
In January, there were 292 petitions for bankruptcy and 215 bankruptcy orders were passed, according to the Insolvency and Public Trustee's Office. Last year, 268 bankruptcy petitions were filed and 230 orders were passed on average each month.
According to data from Credit Bureau (Singapore), the number of delinquent credit card holders has risen steadily. Last December, 14,379 defaulted on their bills — a 1.42-per-cent delinquency rate — as compared to 11,346 and 1.16 per cent in July.
Most owe less than $5,000 each. The majority are between 21 and 44 years old, and men make up almost 70 per cent.
About 80 per cent of the delinquents have credit cards with at least two banks.
Still, the bad debts, while apparently widespread, appear fairly contained for now.
The responses from banks to TODAY's queries on property foreclosures seem to bear this out.
The three local banks said there was no discernable spike in the number of flats getting repossessed. A DBS spokesperson added that neither were there any increases in the number of foreclosures for commercial and industrial properties.
Still, property market sentiments remain tentative. ERA Realty Network assistant vice-president Eugene Lim said: "There is more bargain hunting now. You don't see many people jumping in and buying straightaway, unlike last year."
And it's not just the big-ticket purchases with which Singaporeans are more discerning. NTUC FairPrice managing director Seah Kian Peng said sales of its housebrand products in the last few months have been "very encouraging".
- TODAY/so
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