Subdued global markets weighed on fund management, but domestic credit and payment players drove growth.

Sector Expands 4.3% in 2025, Moderating from 2024's 7.3% Growth

Singapore's finance and insurance sector expanded 4.3% in 2025, down from 7.3% in 2024, according to FPA Financial's February 2026 report. The sector remained resilient through the year, supported by accommodative financial conditions that underpinned credit intermediation and insurance activity. Banking and insurance segments led growth, while fund management faced headwinds from weaker global market conditions.

The Monetary Authority of Singapore (MAS) expects the finance and insurance sector to remain supported by broadly accommodative macroeconomic and financial conditions in 2026, though the regulator has signalled that financial sector growth is unlikely to sustain the pace seen in recent years. MAS Managing Director Chia Der Jiun noted in July 2025 that "we do not expect financial sector growth to continue at the pace of the last few years."

Growth Rate (%)Source: Orionmano Industries

Banking Growth of 4.4% Driven by Domestic Credit Intermediation

The banking segment grew 4.4% in 2025, powered by stronger domestic credit flows. Loans to residents rose 6.1%, driven by a turnaround in lending to the manufacturing sector, though this was partially offset by weaker loans to business services. Consumer lending, including housing loans, also picked up during the year.

External lending to non-residents increased 3.4%, supported by stronger lending to the Americas. The banking sector's total assets had grown at a compound annual growth rate of 6.8% over 2021–2024, according to MAS. The 2025 moderation reflects a normalisation from that elevated base, even as domestic credit intermediation remained robust under the prevailing accommodative monetary conditions.

Auxiliary Financial Services Expand 5.0% on Payment Players

Auxiliary financial services expanded by 5.0% in 2025, the fastest-growing segment tracked by FPA Financial. Growth was led mainly by payment players, which benefited from higher regional spending as travel and cross-border commerce activity continued to recover.

Singapore's position as a regional payments hub continued to strengthen. FX average daily traded volumes surpassed S$1.5 trillion in 2024, MAS data show. The embedded finance market in Singapore was on track to reach US$8.48 billion by 2025, having grown at a 10.3% CAGR between 2021 and 2025, according to a ResearchAndMarkets report. Regulatory initiatives including MAS-led Project Orchid, which explores programmable money, and the city-state's sandbox framework for fintech experimentation continue to support auxiliary services expansion.

Fund Management Grows 5.1% Despite Global Market Headwinds

The fund management segment grew 5.1% in 2025, aided by accommodative financial conditions and improving investor sentiment during the year. However, activity was more subdued overall, reflecting weaker global market conditions that weighed on asset valuations and new fund inflows.

FPA Financial characterised the segment's performance as more subdued compared to prior years, as global equity and fixed-income markets faced volatility and geopolitical uncertainty. Despite this, Singapore's wealth management ecosystem continued to attract legitimate capital. MAS has stated that Singapore "continues to welcome legitimate wealth" while tightening practices to ensure effectiveness against suspicious flows, providing a basis for sustained growth in the wealth management sector.

Insurance Sector Resilient: Domestic General Premiums Up 8.4%

The insurance segment performed robustly in 2025, with life insurance showing particular strength according to FPA Financial. Data from the General Insurance Association of Singapore (GIA) show that domestic general insurance gross written premiums rose 8.4% year-on-year to US$4.76 billion (S$6.1 billion) in 2025. Combined domestic and offshore gross written premiums grew 3.7% to US$8.74 billion (S$11.2 billion).

Net incurred claims for the domestic segment increased 8.7% year-on-year to US$1.40 billion (S$1.8 billion). Motor insurance claims rose 11% year-on-year even as the total number of accidents remained stable, with GIA attributing the increase to higher accident severity—road traffic fatalities reached a 10-year high. Property claims also climbed following a 3% year-on-year rise in fire incidents to 2,050 cases, alongside several large-scale property losses.

Despite the higher claims environment, underwriting performance remained strong. Domestic underwriting profit grew 32% year-on-year to US$225.42 million (S$289 million) in 2025, up from US$170.82 million (S$219 million) in 2024. The industry's total assets had reached S$456.4 billion in 2024, according to MAS, with life and non-life market size estimated at US$6.23 billion in 2025 and projected to grow at a 10.44% CAGR through 2031, according to Mordor Intelligence.

Business sentiment in Singapore's financial sector reflected this resilience. The Singapore Business Federation's National Business Survey reported that the Business Sentiment Index rose 1.2 points to 53.4 in Q4 2025, with insurance and banking among sectors showing the strongest improvement in growth confidence, which rose from 55.4 to 57.7—the highest level recorded in 2025.