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Online shopping surge as shoppers take advantage of strong Sing dollar

By Terence

online shopping surges

Trust a savvy Singaporean shopper to sniff out a good bargain — even if it’s online.

In what seems to be a perfect example of true Singaporean bargain-hunting spirit, an increasing number of people are jumping on the online shopping bandwagon to take advantage of the strengthening Singapore dollar.

Online shopping concierges and internet payment providers report an increase in buying activity from Singapore.

A spokesman from online payment provider PayPal told Yahoo! Singapore that it saw an 11 per cent increase in transactions to the UK in May, and a 13 per cent increase in transactions to the US in July.

“The increases in PayPal online shopping transactions in Singapore correspond very closely to the appreciation of the Singapore currency against both the British pound (GPB) and the US dollar,” said the spokesman.

Online concierge services, which help with payments to overseas retailers who do not accept credit cards issued here, and ship the purchases to Singapore, also said business has increased this year.

At Citi Globeshopper, an online shopping portal for Citibank clients, the number of shipments from the US and UK have increased by some 20 per cent from January to September, as compared to the same period last year, said Mr Vikas Kumar, head of portfolio management and sales at Citibank Singapore.

At HopShopGo, an online shopping site that allows Singaporeans to buy from US online retailers and launched by comGateway and PayPay, top US merchants include Ralph Lauren, Kate Spade, Drugstore.com and Walmart.

SingPost also reported a ”double-digit increase in our shipping volume year-on-year for both vPOSTUSA and vPOSTEurope”.

“Several factors have contributed to this, including strengthening of Singapore dollar and greater awareness of vPOST’s online shopping and shipping service,” said a spokeswoman for the local postal service.

“Shipments from Japan remain relatively flat as the yen strengthened,” she added, perhaps one telling sign of the role a more favourable exchange rate played in increasing consumers’ online shopping activities.

The latest Monetary Authority of Singapore (MAS) exchange rate show the Singapore dollar has gradually strengthened throughout this year.

At the start of the year in January, one British pound was going for S$2.26. That fell to S$2.02 in May, and is at S$2.04 for the week ending on October 22, according to latest available exchange rates from MAS.

It is a similar tale for the US dollar. In July, one greenback was going for S$1.40 before dropping even further to S$1.29 last month. In the latest MAS figures, it’s now S$1.30.

Forex dealer at Philip Futures, Samuel Tay, highlighted the US dollar being at a historical low against the Singapore dollar.

“Compared to last year, the Singapore dollar has risen more than 10 per cent against the US dollar,” he said.

Economist at DBS Group in Singapore, Irvin Seah, forecasted that by the end of next year, it will take only S$1.22 to buy one US dollar.

United Overseas Bank’s analysts forecast that the Singapore will reach S$1.27 by year-end against the US currency, and strengthen further to S$1.23 by the end of 2011.

Industry players expect the online shopping trend to continue.

“We definitely see the stronger Singapore dollar accelerating this online shopping trend, especially for purchases from the US which is the no. 1 online shopping destination for Singaporeans,” said the PayPal spokesman.

He pointed out, six out of every 10 purchases by Singaporeans through PayPal is for an item from a US retailer.

Citibank’s Mr Kumar added, “Due to the upcoming festive shopping season, we expect that the number of shipments will increase over the next few months.”

Undergraduate Clarissa Low, 22, who never shopped online previously, is a recent convert because she wanted to take advantage of the good Sing dollar exchange rate.

“It is much cheaper to buy clothes from abroad now, and it is so much more value for money,” she said. Ms Low now buys from US and UK sites at least once a month.

However, manager Kathryn Ng, 33, said time constraints make it hard to shop online more and take advantage of the possible “savings”.
By Alicia Wong

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