Discusses the most common methods of payment, such as open account, letter of credit, cash in advance, documentary collections, factoring, etc. Includes credit-rating and collection agencies in this country. Includes primary credit or charge cards used in this country. Also includes information on Foreign Exchange controls and Banking Systems, and U.S. Banks & Local Correspondent Banks.
Methods of Payment: Singapore has a well-developed financial system, which offers a full range of export finance instruments. Shipments are generally made under letters of credit and sight drafts (or bills of exchange), depending on the exporter’s preference and the extent of past dealings with the purchaser. Standard credit terms are generally 30 to 90 days and they are allocated on market terms. Quotations are generally made on a C.I.F. basis. Prices given in U.S. dollars should be clearly stated to avoid confusion with the Singapore dollar. Exporters making quotations in Singapore dollars should consult their banks for the prevailing exchange rate. Singapore uses the metric system, so it is beneficial for price/quantity quotations to be prepared accordingly. Credit rating agencies in Singapore include S&P Global Ratings, Moody’s, Singapore Commercial Credit Bureau, and Experian Credit Services Singapore. Primary credit or charged cards used in the country include Visa, Mastercard, American Express, and Diners.
For more information about the methods of payment or other trade finance options, please read the Trade Finance Guide available at https://www.trade.gov/trade-finance-guide-quick-reference-us-exporters.
Banking Systems: The Monetary Authority of Singapore (MAS) performs all the functions of a central bank including the issuance of currency. The unit of legal tender is the Singapore dollar. Besides regulating financial institutions, the MAS has a Financial Sector Promotion Department that promotes new financial activities, develops IT infrastructure and manpower resources for the financial sector, and designs appropriate incentives to attract international financial firms to conduct activities in Singapore.
The MAS regulates all banking activities as provided for under the Banking Act. Singapore maintains legal distinctions between foreign and local banks, and the type of license (i.e., full service, wholesale, and offshore banks) held by foreign commercial banks. Full banks may provide the whole range of banking business but are subject to restrictions on the number of places of business, ATMs and ATM networks. Additional “Qualifying Full Bank” (QFB) licenses may be granted to a subset of full banks, which provides greater branching privileges and greater access to the retail market than other full banks.
Singapore has no trading restrictions on foreign-owned stockbrokers. There is no cap on the aggregate investment by foreigners regarding the paid-up capital of dealers that are members of the SGX. Direct registration of foreign mutual funds is allowed, provided the MAS approves the prospectus and the fund. The USSFTA has relaxed conditions that foreign asset managers must meet to offer products under the government-managed compulsory pension fund (Central Provident Fund Investment Scheme).
Foreign Exchange Controls: The USSFTA commits Singapore to the free transfer of capital, unimpeded by regulatory restrictions. Singapore places no restrictions on reinvestment or repatriation of earnings and capital, and maintains no significant restrictions on remittances, foreign exchange transactions and capital movements.
U.S. Banks and Local Correspondent Banks: Major U.S. banks operating in Singapore include Citibank, JP Morgan Chase Bank, Bank of America, Morgan Stanley, State Street Bank and Trust Company, The Northern Trust Company, Wells Fargo Bank. A full list of local and foreign banks can be found at https://eservices.mas.gov.sg/fid