Underserved borrowers in Singapore are demonstrating remarkable financial discipline, with 86% of loans repaid on time in 2025, according to a new analysis by Friday Finance, part of IFS Capital Group. This trend emerges as Singapore’s national credit card debt hits a record S$9.07b, highlighting the proactive financial management among borrowers traditionally overlooked by mainstream credit institutions.
The study, covering data from January 2020 to December 2025, reveals that underserved borrowers are increasingly engaging in debt consolidation to manage rising credit card rollover balances. This approach helps reduce interest costs and manage monthly debt obligations effectively. “Underserved borrowers can be sustainably served through data-driven underwriting and robust credit portfolio management,” the report notes.
Additionally, there is a growing demand for essential credit, with loan applications for medical expenses and self-improvement rising to 7% and 6%, respectively. This trend reflects households’ efforts to bridge a 16.9% medical inflation gap and invest in reskilling to safeguard future earning potential.
The findings also indicate that micro-SMEs are adopting a cautious ‘wait-and-see’ approach, with business expansion loans declining to 5% of applications amid global economic uncertainty. The report underscores the importance of product design in promoting responsible financial behaviour, suggesting that credit structures rewarding timely repayment can enhance borrower performance.
As Singapore’s credit market evolves, these insights highlight the potential for underserved borrowers to be more reliably integrated into the financial system, challenging traditional risk perceptions.
