Singapore Buy Now Pay Later Business Report 2022-2028: BNPL Firms are Expected to Slow Down their Expansion Strategy Amid Rising Interest Rates

The “Singapore Buy Now Pay Later Business and Investment Opportunities – 75+ KPIs on Buy Now Pay Later Trends by End-Use Sectors, Operational KPIs, Market Share, Retail Product Dynamics, and Consumer Demographics – Q3 2022 Update” report has been added to  ResearchAndMarkets.com’s offering.

BNPL payments are expected to grow by 37.3% on an annual basis to reach US$1,105.2 million in 2022.

Medium to long term growth story of BNPL industry in Singapore remains strong. BNPL payment adoption is expected to grow steadily over the forecast period, recording a CAGR of 19.1% during 2022-2028. The BNPL Gross Merchandise Value in the country will increase from US$804.9 million in 2021 to reach US$3,158.3 million by 2028.

In Singapore, buy now pay later (BNPL) is a small but rapidly growing Fintech sector. One of the major contributors to the growth of the Singaporean BNPL industry has been the increased usage of e-commerce platforms during the global pandemic outbreak. As Singapore continues to move towards a cashless society, BNPL platforms are becoming increasingly popular in the city-state. This popularity is evident from the growing BNPL transactions and year-on-year growth in Singapore.

The publisher expects the growth to continue in the Singaporean BNPL industry, and millennials, which form the largest segment of BNPL users, are expected to drive major transaction value and volume growth over the next three to four years as they have begun to enter into their spending years. Moreover, more BNPL services are expected to pop up in the country as their popularity continues to grow among Singaporean shoppers from the short to medium-term perspective.

To drive sustainable growth in the Singaporean BNPL industry, new guidelines are being developed to better safeguard consumer interests. Notably, the Singapore Fintech Association (SFA) has formed a BNPL working group that consists of members such as Atome, Grab, and hoolah, which will work under the guidance of the Monetary Authority of Singapore (MAS).

Consolidation between BNPL firms is expected to gain rapid momentum as players seek to strengthen their position in the region

Amid the growing competition in the BNPL market, consolidation trends are expected to gain rapid momentum in the region as firms seek to strengthen their position in the industry. Notably, mergers and acquisitions are expected to accelerate in Singapore as firms face headwinds amid rising inflation and interest rates. These trends have started to emerge in the Singaporean market in H1 2022.

• In March 2022, Pace Enterprise (Pace), one of the leading BNPL players in Singapore, announced that the firm had acquired Rely, the home-grown Fintech startup which offers BNPL in the region. This acquisition of Rely will further strengthen Atome’s merchant network.
• As of March 2022, Pace has more than 5,000 point-of-sales across the Asian region. Notably, the firm is on track to meet its goal of one million users by the end of 2022 and is also aiming to have an annualized gross merchandise value of US$1 billion by the end of 2022.

Over the next three to four years, the publisher expects more such mergers and acquisition deals in Singapore and across the Asian region as firms continue to strengthen their position in the market.

BNPL integration platforms are raising a funding round to further accelerate the growth of their platform

The BNPL market worldwide has become increasingly crowded, with more and more players launching the service. These players are then entering into strategic partnerships with merchants to drive adoption among consumers.

However, with so many players entering the space, merchants find it cumbersome to work with several BNPL providers. This has resulted in innovative startups, such as BNPL integration platforms, that integrate several BNPL products into one platform. These innovative startups are raising funding rounds to accelerate their rapid expansion globally.

• In April 2022, Optty, a Singapore-based BNPL service aggregator, announced that the firm had raised US$9 million to launch the platform for retailers. In the stealth mode, the platform was handling 185 integrations with 41 BNPL providers such as Afterpay, Grab, Klarna, Affirm, Scalapay, and Zip. By the end of 2023, the firm plans to integrate more than 100 BNPL brands and digital wallets.
• Notably, the firm reduces the operational time for retailers to just a few minutes, as opposed to when the retailers work with BNPL providers directly, where they wait at least a week for offering their customers with BNPL payment option. Moreover, by offering several BNPL payment methods through the same platform, retailers record more conversion rates and sales.

As the BNPL market continues to evolve and mature over the next three to four years, the publisher expects more such innovative startups to emerge in the global market. This will subsequently drive the market growth from the short to medium-term perspective.

BNPL firms are expected to slow down their expansion strategy amid rising interest rates

During the global pandemic period, BNPL firms recorded strong growth and, as a result, aggressively expanded their operations around the world. However, as central governments around the world hike interest rates, which will eat up profit margins of BNPL firms, the publisher expects the players to slow down their expansion strategy.

• In July 2022, Zip Co (Zip), one of the leading global BNPL firms from Australia, shut down its operation in Singapore. This move is part of the firm’s strategy to preserve cash, which resulted in the slowdown of its expansion strategy.
• Notably, the exit of Zip from the Singaporean market is an indication that the market is entering into a period of consolidation amid the period of high-interest rates globally.

From the short to medium-term perspective, the publisher expects more global BNPL firms to slow down their expansion amid the economic headwinds experienced by businesses across different industries.

Scope

Singapore BNPL Market Size and Spending Pattern

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

Singapore Buy Now Pay Later Operational KPIs

• Buy Now Pay Later Revenues, 2019 – 2028
• Buy Now Pay Later Share by Revenue Segments
• Buy Now Pay Later Merchant Commission, 2019 – 2028
• Buy Now Pay Later Missed Payment Fee Revenue, 2019 – 2028
• Buy Now Pay Later Pay Now & Other Income, 2019 – 2028
• Buy Now Pay Later Accounts, 2019 – 2028
• Buy Now Pay Later Bad Debt, 2019 – 2028

Singapore Buy Now Pay Later Market Share Analysis by Key Players (Atome, Hoolah, Rely, Grab, Split)

Singapore Buy Now Pay Later Spend Analysis by Channel: Market Size and Forecast

• Online Channel
• POS Channel

Singapore Buy Now Pay Later in Retail Shopping: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

Singapore Buy Now Pay Later in Home Improvement: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

Singapore Buy Now Pay Later in Leisure & Entertainment: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

Singapore Buy Now Pay Later in Healthcare and Wellness: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

Singapore Buy Now Pay Later in Other: Market Size and Forecast

• Gross Merchandise Value Trend Analysis
• Average Value Per Transaction Trend Analysis
• Transaction Volume Trend Analysis

Singapore Buy Now Pay Later Analysis by Consumer Attitude and Behaviour

• Buy Now Pay Later Sales Uplift by Product Category
• Buy Now Pay Later Spend Share by Age Group
• Buy Now Pay Later Gross Merchandise Share by Income
• Buy Now Pay Later Gross Merchandise Value Share by Gender
• Buy Now Pay Later Adoption Rationale Gross Merchandise Value Analysis

Companies Mentioned

• Grab PayLater
• Atome
• Hoolah
• rely
• octifi
• FavePay Later
• Split
• Citi Bank
• convertCASH
• BridgerPay