(MENAFN- GlobeNewsWire - Nasdaq) Key market opportunities in Singapore's alternative lending include BNPL standardization favoring accredited providers, embedding SME credit within digital ecosystems, tightening digital acquisition standards, and expanding private credit funding pathways. These shifts could enhance regulatory compliance, market reach, and investment potential.Dublin, Feb. 19, 2026 (GLOBE NEWSWIRE) -- The "Singapore Alternative Lending Market Size & Forecast by Value and Volume Across 100+ KPIs by Type of Lending, End-User Segments, Loan Purpose, Finance Models, Distribution Channels, and Payment Instruments - Databook Q1 2026 Update" report has been added to ResearchAndMarkets's offering.
The alternative lending market in Singapore is expected to grow by 15.3% annually, reaching US$5.50 billion by 2026. The alternative lending market in the country has experienced robust growth during 2020-2025, achieving a CAGR of 14.5%. This upward trajectory is expected to continue, with the market forecast to grow at a CAGR of 13.3% from 2026 to 2029. By the end of 2029, the alternative lending market is projected to expand from its 2025 value of US$4.77 billion to approximately US$8.00 billion.
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BNPL competition should tighten further around accredited operators and bank-aligned models as governance expectations rise and funding becomes more selective. Platform checkouts (Grab, Shopee) and digital-bank stacks will remain the highest-value acquisition surfaces, favouring providers that can integrate tightly into refunds/returns, dispute handling, and merchant operations.
The report offers in-depth segmentation across lending dimensions, including type of lending (Bank-based/NBFC and Alternative Lending), end-user segments (Retail Lending and SME/MSME Lending), and loan types. It further categorizes the alternative lending ecosystem by finance models (P2P Marketplace, Balance Sheet, Invoice Trading, Real Estate Crowdfunding, and Other Models), distribution channels (Branch/Physical, Direct Digital, and Agent/Broker), and payment instruments (Credit Transfer, Debit Card, E-Money, and Others).
In addition, the analysis captures borrower demographics by age, income, and gender, alongside delinquency performance indicators. Collectively, these datasets provide a comprehensive and quantifiable view of market size, structure, lending behavior, and risk dynamics within the lending ecosystem.
Current State of the Market
BNPL in Singapore is now completed primarily through a small set of providers that hold the BNPL Compliance Trustmark under the Singapore FinTech Association (SFA) regime, which shapes which options platforms and merchants are willing to surface at checkout. Competitive intensity is highest where BNPL is embedded into large consumer ecosystems (mobility, marketplaces, e-wallet checkouts), because these channels control repeat frequency and repayment UX. SME credit is increasingly bundled into digital-bank and platform stacks (business accounts, payments, merchant tools), tightening the link between distribution and funding capacity.
Key Players and New Entrants
Key accredited providers: Atome, Grab PayLater, and Shopee SPayLater (SeaMoney's entity), with ABNK also in the accredited cohort. New entrant pressure comes from banks and card issuers expanding instalment-style features that compete for the same "pay-over-time" use case inside existing credit relationships. GXS Bank / GXS Capital (Validus), Funding Societies (Modalku), and platform-led merchant finance propositions (e.g., GrabFinance) are central to competitive positioning.
Key Trends & Drivers
Pull BNPL into a supervised-style operating model
Singapore's BNPL market is converging on a "rules-first" operating posture through the Singapore FinTech Association-administered BNPL Code of Conduct and an accreditation (trustmark) regime. MAS has confirmed the accredited cohort and has addressed BNPL conduct topics in Parliament, keeping the model under close policy attention. The accredited BNPL providers list (e.g., Atome, Grab, and Shopee's SPayLater entity, plus ABNK) is becoming a de facto reference point for merchants and platforms deciding which pay-later options to surface at checkout. BNPL is widely used in digital commerce journeys, so consumer-friction decisions (instant approval, low upfront checks) create conduct risk that policymakers want consistently addressed. MAS has explicitly linked its approach to reducing consumer harm while advancing payments innovation. Competitive advantage will shift toward providers that can operationalise customer eligibility controls, disclosures, and arrears handling without disrupting checkout conversion. Merchant partners will increasingly prefer accredited providers as a baseline, and smaller/non-accredited models may find distribution harder.
Move SME credit into platform and digital-bank ecosystems.
Alternative lending for SMEs is increasingly delivered "inside" operating platforms (merchant apps, procurement/payment flows) and digital banks, rather than via standalone loan applications. A clear signal is GXS Bank's acquisition of Validus Capital (Singapore), positioning supply-chain finance and working-capital credit as part of a broader business-banking stack. In parallel, GrabFinance is pushing merchant cash-advance style lending through the Grab Merchant app, including conversational/assisted discovery of loan options. Platforms and digital banks sit on high-frequency merchant interactions (sales, settlements, refunds, operating spend), which improve underwriting and collections control compared with cold-start lending. SMEs also prefer credit bundled with tools they already use (merchant super-apps, supply-chain workflows), reducing onboarding friction and documentation overhead. Expect more "distribution bundling": SME credit offered alongside business accounts, payment acceptance, and commerce tooling. M&A/partnerships that combine regulated balance sheets with fintech origination and data workflows should accelerate, following the GXS-Validus pattern.
Tighten digital acquisition standards for lending and pay-later products.
MAS is formalising expectations for how financial products are marketed online, including via digital advertising and content distribution channels. The new MAS Guidelines on Standards of Conduct for Digital Advertising Activities set clearer boundaries for digital campaigns and influencer/marketer practices (effective March 2026). Separately, MAS has continued to update cross-sector financial crime expectations (AML/CFT notices and guidelines), which affect onboarding, monitoring, and partner management for digitally-originated credit. Credit and pay-later are increasingly sold and serviced through online funnels (apps, social channels, embedded widgets). This concentrates mis-selling and scams risk in the same channels that drive growth, pushing supervisors to set clearer conduct expectations. Alternative lenders and BNPL providers will need tighter governance over third-party marketers, clearer approval controls for digital creatives, and better auditability of customer journeys. This raises compliance costs and should favour scaled platforms and bank-linked models that already run formal conduct programs.
Broaden domestic funding pathways for private credit and receivables-style strategies.
MAS is working on a framework to expand retail access to private-market funds (including private credit) via a proposed Long-Term Investment Fund (LIF) regime. While not "lending regulation," it is relevant because it can expand the investable capital pool that ultimately backs private credit strategies and specialty finance. Investor demand for diversified sources of return and Singapore's broader capital markets agenda are pushing regulators to consider structures that balance private-market asset characteristics with retail safeguards. If implemented, a wider domestic investor base for private credit funds could increase competition for quality SME/receivables assets and encourage more institutional-grade reporting, servicing, and governance from originators.
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