By Kenny Chee

THE number of people who are delinquent or defaulting on credit payments is not significant now, despite the economic downturn.

But industry insiders caution that if unemployment continues to rise, many more could end up having difficulty servicing their credit-card bills or loans.

Credit Bureau Singapore (CBS) defines delinquency as accounts that are 30 or more days past the due date for payment, while a default occurs when the account is written off.

According to the bureau's latest figures for the quarter ended Sept 30, a monthly average of 1.43 per cent of consumers, or 15,430, missed at least one payment on one or more of their credit-card accounts. For those with at least one credit-card account written off, the average was 0.15 per cent, or 1,658 consumers, a month.

In the second quarter, the figures were 1.37 per cent and 0.12 per cent respectively.

Although numbers in the third quarter have risen from the second quarter and the same period last year, they were still lower than those seen in 2003, after the Sars disease hit.

Said CBS executive director William Lim yesterday: "For now, consumers here continue to be able to manage their credit- card and personal-loan payments."

But he said that they should still manage their credit prudently and not be complacent.

"We are going into a recession and there is a lag effect that won't be felt until one quarter down the road," he said.

Many consumers, he added, would be able to service their outstanding debts if unemployment rates are kept low.

"But if there are more layoffs, we will see the situation deteriorate."

The jobless rate in Singapore rose sharply after Sars hit in 2003, and credit-card delinquency and default rates climbed to 2.46 per cent and 0.18 per cent respectively in the fourth quarter of that year.

Local banks my paper spoke to said they will continue to exercise caution when offering credit facilities.

Said OCBC Bank's head of lifestyle credit Ms Lynn Gaspar: "OCBC Bank has always been prudent in granting credit facilities, and will maintain its prevailing credit-assessment criteria."

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