Retail SME index hits record 53.4 in Q1 as Mideast tensions loom

Collections rose 15.2%, whilst payments grew 15.5% in the quarter.

Retail small and medium enterprises (SMEs) sustained their growth in the first quarter of 2026 (Q1), with the OCBC SME Index hitting an all-time high of 53.4, remaining firmly in expansion territory above the 50 mark.

The sector recorded a 15.2% year-on-year increase in overall collections and a 15.5% rise in payments during the quarter.

The index dipped to 49 in Q1 2025 from 50.5 in the previous quarter.

Meanwhile, it recovered to 50.6 in Q2 2025 and continued to climb through the rest of the year, reaching 51.5 in Q4 before accelerating further in Q1 2026.

OCBC attributed the growth to inbound tourism spending, alongside a firm domestic labour market and stable macroeconomic conditions that provided broad-based support to retail SMEs.

However, the report flagged near-term risks from geopolitical tensions in the Middle East, particularly through higher input costs that may be passed on to consumers, and inflationary pressures that could affect purchasing power.