Rising costs fail to slow spending for 42% of Singaporeans

Gen Z and Millennials led higher spending and social commerce.

Rising costs are reshaping consumer spending in Singapore, with 42% of consumers spending more than a year ago, whilst 25% are spending less, according to the Adyen Index 2026 Singapore Retail Report.

Amongst those spending more, 62% cited the rising cost of living and changes in interest rates as the main reasons. Meanwhile, 36% pointed to changing needs or priorities, whilst 20% attributed higher spending to economic uncertainty.

The report also found that younger consumers are driving higher spending. Half of Gen Z (50%) and 51% of Millennials said they are spending more than a year ago, compared with 36% of Gen X and 29% of Baby Boomers.

Gen Z spent an average of S$104 per purchase via social media shopping platforms, whilst Millennials spent S$106. This compared with S$80 for Gen X and S$62 for Baby Boomers.

Lifestyle choices also influenced spending patterns. Around 28% of Gen Z and 17% of Millennials said they were choosing to enjoy life more, compared with 6% of Baby Boomers.

Meanwhile, 72% of Singaporeans having used AI assistants to support their shopping. Among AI users, 72% said AI helps them cut through online noise, 68% said it provides inspiration faster, and 66% said they use it to discover unique brands and shopping experiences.

AI adoption was highest amongst younger consumers, with 85% of Gen Z and 80% of Millennials using AI assistants for shopping.

The report also showed that 46% of respondents want a seamless shopping experience across online and physical stores, whilst 43% want real-time product visibility and 38% expect technology to make shopping faster and more convenient.

On the retail side, 99% of surveyed Singapore retailers said they use AI in some capacity. The most common applications were customer service and support, cited by 46% of retailers, followed by marketing and promotions at 45%, customer experience at 43%, and operations and efficiency at 42%.

However, 95% of retailers said they continue to face barriers to broader AI adoption. The top challenges were competing priorities or limited resources, cited by 39% of respondents, followed by integrating AI into existing systems at 38% and a lack of internal AI skills or expertise at 35%.

The report also found that payment reliability remains critical. Around 59% of consumers said a payment error at checkout negatively affects their perception of a retailer. Amongst them, 24% said their trust drops significantly, 20% said they would abandon the purchase and avoid the retailer in future, and 15% said they would switch to a competitor.