Almost S$2 million lost in prepayments by S'pore customers to businesses suddenly closing down, becoming unresponsive

The Consumers Association of Singapore (“CASE”) has seen prepayment losses of about S$1,930,000 in 2024.

This is more than four times the amount of S$476,000 reported in 2023, CASE stated in a press release on Feb. 6, 2025.

The losses were largely due to sudden business closures and companies becoming unresponsive after consumers had made payment.

One-third of losses came from renovation sector, at more than S$728,800

Around one-third of the prepayment losses were attributed to the renovation sector, where renovation contractors suddenly became uncontactable during the renovation process.

This resulted in some consumers being left with incomplete homes and having to rush to find another contractor to complete their renovation works.

According to CASE, the total prepayment losses stemming from the renovation sector was S$728,813.26.

As for the number of complaints against renovation contractors, it came up to 962, a decrease from 2023's figure of 1,168.

Around 97 per cent of the complaints were made against non-CaseTrust accredited contractors, while all complaints related to accredited contractors were successfully resolved, CASE highlighted.

The President of CASE, Melvin Yong, said:

"CASE is concerned about the sharp rise in prepayment losses, mainly driven by the renovation sector. All the cases where consumers lost their prepayments and deposits were a result of consumers who had patronised from non-CaseTrust accredited renovation contractors.

Yong added:

"Consumers are advised to engage CaseTrust-accredited companies whenever the purchase involves large prepayments because these companies buy insurance to protect your interest. CASE will soon announce enhancements to CaseTrust to offer consumers more choices and greater assurance."

Bridal and mover sectors accounted for the second and third-highest amount of prepayment losses

Meanwhile, the bridal sector saw the second-highest amount of prepayment losses, at S$284,468.65.

This was largely due to the sudden closure of Love Nest and its related entities in April 2024.

The mover sector accounted for the third-highest amount of prepayment losses, at S$134,238.53.

This was due in part to large deliveries being undelivered or loss of goods during moving.

CASE received a total of 14,236 complaints in 2024

In total, CASE received 14,236 complaints in 2024, a two per cent increase from the 13,991 complaints received in 2023.

The five industries that accounted for the highest number of complaints in 2024 were the motorcars, electrical and electronics, beauty, renovation contractors and entertainment industries.

Rise in complaints in entertainment sector driven by botched Sky Lantern event, ticket scalping

In addition, the entertainment, telecommunications, and food and beverage sectors saw a significant increase in the number of complaints received.

The entertainment industry in particular saw a saw a 281 per cent spike in complaints, from 209 complaints in 2023 to 798 complaints in 2024.

This was largely due to the botched Singapore Sky Lantern Festival in February 2024, and complaints pertaining to ticket scalping.

The food and beverages and telecommunications sector also saw a large rise in complaints.

Food and beverages complaints went up 24 per cent from 571 complaints in 2023 to 708 complaints in 2024.

This was largely due to the cancellation of Sakura Buffet's licence over food safety concerns, which left consumers’ orders unfulfilled.

As for the telecommunications sector, complaints increased 34 per cent from 529 complaints in 2023 to 710 complaints in 2024.

Consumers typically complained of poor connectivity, delayed installation of broadband services and high charges in consumers’ bills.

2024 also recorded the highest number of e-commerce complaints

2024 also saw CASE record the highest number of e-commerce complaints, at 4,641, since it began tracking e-commerce complaints in 2020.

This is a 25 per cent increase from 3,711 complaints in 2023.

Of the e-commerce complaints received in 2024, approximately 13 per cent were from the entertainment industry and 9 per cent from the food and beverage industry.

About 80 per cent of cases resolved by CASE in 2024

CASE added that for 2024, approximately 80 per cent of the cases in which CASE was authorised by consumers to negotiate with businesses were resolved.

According to the press release, this is a 4 per cent improvement from 2023 and is CASE’s highest resolution rate in the past five years.

Yong highlighted:

"It has been many years since our consumer protection laws were last reviewed. The 2024 statistics show that more needs to be done to better protect consumers shopping online, and also more safeguards are needed for consumers in sectors that collect large prepayments.

CASE will engage the government on the need to update our laws, work with our stakeholders to improve consumer education, and take steps to tackle industry-specific concerns."

Top image by Mothership