Consumers lost $645,000 in prepayments in 2022. says Case

Amount 24% higher than in 2021; beauty, travel industries record highest losses

- Amanda Lee Correspondent

Consumers lost more than $645,000 in prepayments in 2022 because of the sudden closure of businesses, with the beauty industry accounting for the highest amount of losses, followed by the travel industry.

The total amount was a sharp increase of 24 per cent from $520,000 in 2021, the Consumers Association of Singapore (Case) said in a statement on its annual consumer complaint statistics for 2022 on Friday.

The beauty industry recorded more than $285,000 in prepayment losses, or 44 per cent of the annual amount. The travel industry came in second with losses of over $141,000, or 22 per cent of the total.

Prepayment losses in the beauty industry mostly stem from consumers being unable to obtain refunds for prepaid packages bought from beauty salons, aesthetic clinics and spas due to sudden business closure.

The prepayment losses in the travel industry were from sudden closures of travel agencies and the cancellation of advance bookings for flights and hotel accommodation owing to the Covid-19 pandemic.

Due to the sudden shutdown of small renovation firms, the renovation contractor industry recorded $49,000 in prepayment losses.

Case president Melvin Yong said the association is concerned about the sharp increase in total prepayment losses from 2021 to 2022, especially against the backdrop of economic uncertainty.

"We reiterate our call on the Government to consider mandating prepayment protection in industries which collect large sums of prepayment, such as the beauty and renovation contractor industries," he added.