SINGAPORE
Singapore is a small territory with few natural resources. It enjoys a strategic geographical location in Asia and a world-leading, technically competent and productive workforce. Singapore ranks as one of the world’s most open economies and well-run states. Over the past decade, the focus of Singapore’s economic policy has shifted to maintaining its competitiveness in attracting trade and investment flows by building a more technology-driven, innovation-based growth model.
Singapore’s real GDP growth has been more volatile since the early 2000s. It already slowed from 3.5% in 2018 to 1.3% in 2019 as Singapore is vulnerable to the impact of the US-China trade conflict and global trade weakening given its very high degree of trade and financial openness (exports represented more than 200% of GDP in 2019 and trade-related sectors account for more than 50% of GDP). The city-state was very hard hit by the COVID-19 shock, with an economic contraction of 5.4% in 2020. However, Singapore’s strong macroeconomic fundamentals, with solid external and fiscal accounts, and sound policy management represent comfortable cushions against shocks. Economic growth is expected to be modest, with the government forecast at between 1.0% 3.0% for 2024.
Summary
BNP Paribas has had a presence in Singapore since 1968, with 850 employees and a full banking license. In addition, Singapore is BNP Paribas' regional hub for south-east Asia, enabling customers to access comprehensive payments, collections, cash and liquidity management and international trade finance solutions across the region. This is particularly important for regional treasury centres of multinational corporations that are seeking to implement cohesive regional and global solutions.
Currency
- Singapore dollar (SGD).
| 2019 | 2020 | 2021 | 2022 | 2023 | |
| Exchange rate: SGD per USD | 1.36 | 1.38 | 1.34 | 1.38 | 1.34 |
Source: IMF, International Financial Statistics, June 2024.
- The Singapore central bank is the Monetary Authority of Singapore (MAS -www.mas.gov.sg).
Bank supervision
- Singapore banks are supervised by the MAS.
Bank accounts
- A company is considered resident in Singapore if it has a permanent or registered address in Singapore and maintains its place of effective management in Singapore.
| Within SINGAPORE | Outside SINGAPORE | |
| Local Currency | Permitted without restriction, fully convertible |
Permitted although subject to the restrictions of that particular currency, fully convertible |
| Foreign Currency | Permitted without restriction, fully convertible |
Permitted without restriction, fully convertible |
| Within SINGAPORE | Outside SINGAPORE | |
| Local Currency | Permitted without restriction, fully convertible |
Permitted without restriction, fully convertible |
| Foreign Currency | Permitted without restriction, fully convertible |
Not applicable |
- Lifting fees, most typically per item-based charges and/or subscription fees, are applied on payments between resident and non-resident bank accounts.
BNP Paribas Cash Management Capabilities
| Cash collections | |
| Cheque collections | |
| Direct debit collections | |
| Domestic incoming transfers | |
| Virtual IBAN | |
| Virtual accounts | |
| International incoming transfers | |
| Card acquiring |
| Cash withdrawals | |
| Cheque payments | |
| Direct debit payments | |
| Domestic outgoing transfers | |
| Commercial cards | |
| Virtual cards | |
| International outgoing transfers | |
| SWIFT gpi | |
| Real-time international payments through BNP Paribas’ network | |
| Card issuing |
| Local e-Banking | |
| Global e-Banking - Connexis | |
| SWIFT/ host to host |
Payments & collections
Cash payments have been replaced by card-based e-money, which is the most popular non-cash payment instructions in volume terms in Singapore. The Singapore Quick Response Code (SGQR) was also launched in 2018 and is now the primary means for Scan and Pay, available at over 210,000 merchant payment points.
Electronic banking services are available from all banks. There is no national electronic banking standard in Singapore, so companies use banks’ proprietary services.
Online and mobile banking services are provided by all of the country's banks. The country is third in the digital competitiveness ranking 2023. As of October 2023, the number of digital banking users reached 1 million and this is expected to grow to 1.7 million by 2025. Payments via internet and mobile banking with a value of up to SGD 200,000 can be
processed in near real time via FAST.
PayNow Corporate, an electronic fund transfer service for businesses and corporates, enables businesses and the Singapore Government to pay and receive SGD funds instantly with the linking of the Unique Entity Number (UEN) to their Singapore bank account.
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| System holidays | MEPS+ is closed on all Singaporean bank holidays. Singapore bank holidays can be found on the Ministry of Manpower website: https://www.mom.gov.sg/employment-practices/public-holidays . | |
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| System holidays | Singapore bank holidays can be found on the Ministry of Manpower website: https://www.mom.gov.sg/employment-practices/public-holidays | |
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(Please note that the below is all based on what is available in Singapore but does not reflect BNPP's capabilities.)
- Credit transfers are used by companies to pay salaries and suppliers, and for treasury payments.
- Credit transfers are available as both paper-based and electronic payment instruments.
- High-value and urgent domestic SGD-denominated credit transfers can be settled in real time via MEPS+.
- Low-value, non-urgent and high-volume credit transfers can be settled via the IBG on a same day basis or up to three business days.
- Low-value credit transfers can also be settled via FAST (SGD 200,000 or less). FAST can be used 24 hours a day, seven days a week. Thirty banks and seven non-financial institutions participate in FAST.
- Low-value credit transfers can also be made via PayNow (SGD 200,000 or less) on a near real-time basis. Payments are settled via FAST. PayNow has adopted the Singapore Quick Response Code (SGQR) specifications, enabling businesses to collect payments via the service through QR codes. There are nine bank participants in in PayNow, and three non-bank financial institutions. There are twenty-one bank participants in PayNow, and five non-bank institutions. Over 80% of individuals and businesses are registered on PayNow.
- PayNow Corporate enables entities such as businesses to pay and receive SGD funds instantly with the linking of the Unique Entity Number (UEN) to their Singapore bank account. PayNow corporate registrations totalled 240,000 by end 2020.
- As of February 2021, eligible non-bank financial institutions have had direct access to FAST and PayNow, enabling users of e-wallets to make real-time transfers between bank accounts and e-wallets as well as across different e-wallets.
- Cross-border transfers can be made via SWIFT and settled through correspondent banks abroad.
- In 2020, the volume and value of credit transfers increased 24.4% and 10.8% respectively, to 255 million transactions, with a value of SGD 664.3 billion.
In 2021, the Association of Banks in Singapore (ABS) launched the eGIRO service that fully digitises the current paper-based GIRO process.
- The cheque is a popular cashless payment instrument, used by both consumers and companies.
- Cheques are truncated into electronic items before being settled on a next-day basis.
- Singapore has two cheque truncation systems: one for SGD-denominated cheques (SGDCTS), the other for USD-denominated cheques (USDCTS).
- Final settlement of SGD and USD-denominated cheques takes place via MEPS+.
- In July 2023, MAS announced that all corporate cheques will be eliminated by end-2025 while individuals will still be able to use cheques for a period after 2025.
- Card payments are increasingly popular, especially for retail transactions. There were 7.0 million credit cards in circulation at the end of December 2023.
- Contactless payment cards are issued and their use increasing.
- Visa-branded payment cards are the most widely issued, although MasterCard, American Express and Diners Club credit cards are also available.
- All card payments are processed via NETS on a same-day basis.
- All cards issued have EMV chips.
- In 2023, the volume of card payments grew 21.6% year on year to 1.98 million transactions. The total value also grew 13.7% to SGD 1.41 billion.
- There are three main ATM networks in Singapore: the proprietary DBS-POSB network, the atm5 network, which is used by six foreign banks, and the NETS network, which is operated by MasterCard and used by the United Overseas Bank and the Overseas-Chinese Banking Corp. The networks are not interoperable.
- All payments are processed via NETS on a same-day basis.
- All ATMs and POS terminals are EMV-compliant.
- The MEPS operated Shared ATM Network switch connects all ATMs in Singapore.
- The dominant electronic wallet schemes are the NETS operated CashCard and FlashPay schemes, as well as an independent EZ-Link card.
- Single and multi-purpose stored-value cards are both available.
- Card-based e-money transactions fell 33.8% and 36.7% in volume and value terms respectively in 2020, on 2019 figures.
- Mobile wallets are widely accepted throughout Singapore due to the SGQR code. Popular e-payment methods include GrabPay, AliPay Nets and PayLah.
- E-money payments are settled on a next-day basis via NETS.
- In 2023, E-money transactions saw a slight decline of 6.8% in terms of volume to 2.22 million transactions compared to the previous year. The total value grew by 11.5% to SGD 2.4 billion in the same period.
Short term investments
Interest payable on credit balances
- Interest-bearing current accounts are permitted, although not widely available.
Demand deposits
- Demand deposits denominated in SGD or major foreign currencies are available with terms ranging from overnight to over one year.
Time deposits
- Time deposits are available in SGD or major foreign currencies for terms ranging from one week to over one year.
Certificates of deposit
- Domestic banks issue SGD-denominated certificates of deposit with terms ranging from three months to five years. The minimum investment is
SGD 100,000. - Some banks issue foreign currency denominated certificates of deposit with terms ranging from one month to five years. The minimum investment is USD 100,000.
- Certificates of deposit can be issued paying fixed or variable interest.
Treasury (government) bills
- MAS auctions various treasury bills based on their auctions and issuance calendar found at https://www.mas.gov.sg/bonds-and-bills/auctions-and-issuance-calendar. The minimum investment amount is SGD 1,000.
- Singapore’s most reputable companies do issue commercial paper, but it is not widely available.
Money market funds
- Money market funds are popular short-term investment instruments.
Repurchase agreements
- Repurchase agreements are commonly available in Singapore.
Banker's acceptances
- Banker’s acceptances are rarely used in Singapore.
BNP Paribas Trade Finance Capabilities
| Documentary credits | |
| Documentary collections |
| Bank guarantees | |
| Standby letters of credit |
| Receivables | |
| Payables | |
| Inventory |
| Connexis Trade | |
| Connexis Supply Chain | |
| SWIFTNet Trade for Corporates | |
| Connexis Connect | |
| Connexis Guarantee | |
| SWIFTnet Supply Chain |
- The professionals in the BNP Paribas Global Trade Solutions (GTS) team in Singapore offer both local and regional support across Asia Pacific. GTS in Singapore provides a wide range of product offerings from traditional trade products to supply chain management solutions complemented by excellent service delivery by ISO-certified middle and back offices. With strong product expertise and in-depth knowledge of local market requirements, BNP Paribas has become a leading trade finance bank in the region.
International trade
- As a member of the Association of Southeast Asian Nations (ASEAN), Singapore has entered into the ASEAN Trade in Goods Agreement (ATIGA) between member states (Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam). Singapore is also a member of the ASEAN Free Trade Area (AFTA) and is committed to reducing and eliminating tariffs between members.
- As a member of the Asia-Pacific Economic Cooperation (APEC) forum, Singapore has agreed to liberalise trade and investment rules between members.
- Singapore has 27 implemented free trade agreements in place with more than 30 trading partners, including USA, China, Australia, the GCC, the TPSEP, EFTA and Japan.
- Singapore is a signatory of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). The CPTPP came into force in December 2018.
- Singapore is a signatory of the Regional Comprehensive Economic Partnership (RECP). The country ratified the agreement in April 2021.
- ASEAN has signed free trade agreements (FTAs) with Australia, China, Japan, Hong Kong, India, New Zealand and South Korea.
| Imports | Integrated circuits | Gold | Refined petroleum products | Gas turbines | Crude petroleum | |
| Primary Import sources | China (16.0%) | Malaysia (11.0%) | USA (9.0%) | Taiwan (7.0%) | Japan (5.0%) | Indonesia (5.0%) |
| Exports | Integrated circuits | Gold | Refined petroleum products | Gas turbines | Packaged medicines | |
| Export markets | China (15.0%) | Hong Kong (13.0%) | Malaysia (9.0%) | USA (8.0%) | Indonesia (7.0%) | India (5.0%) |
| 2016 | 2017 | 2018 | 2019 | 2020 | ||
| Exports | - goods USD m | 371,402 | 413,883 | 458,950 | 441,350 | 411,634 |
| - services USD m | 155,160 | 169,686 | 206,748 | 217,187 | 187,564 | |
| Imports | - goods USD m | 284,256 | 316,496 | 357,370 | 344,508 | 317,991 |
| - services USD m | 157,599 | 180,247 | 200,122 | 208,198 | 172,689 | |
| Current account as % GDP | 18.0 | 18.2 | 17.1 | 16.9 | NA | |
Source: IMF, International Financial Statistics, June 2021.