**SINGAPORE**: A striking transformation in Singapore's gig economy has emerged as a recent report from Channel News Asia reveals that personal loan applications among private-hire drivers and delivery riders have surged by 12% over the past two years. This alarming trend, highlighted by the online loan-matching service Lendela, underscores that many of these workers are resorting to loans merely to manage daily expenses and consolidate existing debts.

In a bid to alleviate some financial burdens, Grab launched its Partner Cash Advance program earlier in 2023, offering loans of up to S$10,000 to its drivers. However, this initiative appears insufficient, as a significant number of workers continue to struggle with mounting bills.

Living Paycheck to Paycheck

Private-hire drivers and delivery riders find themselves in a financially precarious situation, with a DBS study indicating that a startling proportion of them are experiencing an expense-to-income ratio exceeding 100%. With monthly earnings typically ranging between S$1,500 and S$2,500, the burden of rising fuel prices, car rentals, and essential daily expenses leaves little room for savings. Just one unanticipated event—a medical emergency, for instance—can thrust them into debilitating debt.

Take the story of Mohamed Norfirdaus, a delivery rider diagnosed with colon cancer. Norfirdaus has had to rely on loans for survival after being unable to work for nine months due to his condition. He has actively sought alternative employment but is hampered by his situation, often needing to make trips to manage his stoma bag, a barrier to returning to his previous job as a lifeguard.

The Appeal of Flexibility in Gig Work

Flexibility is a pivotal factor attracting workers to gig employment. Mr. Ng, another delivery rider, pointed out that many in the field are older individuals—often caregivers—balancing responsibilities for both children and elderly parents, which makes traditional full-time jobs impractical.

Statistics from the Ministry of Manpower reveal that about 69% of gig workers, who primarily rely on platform work for income, are aged 50 and above. The trend is troubling, with Lendela highlighting a jump in loan applications from platform workers aged 50 to 69 from 11.2% in 2022 to an alarming 21.1% in 2024.

Additionally, Assoc Prof Theseira has observed that platform work often fails to reward experience and skill adequately. He indicates, “It wouldn’t be surprising if a long-term platform worker had worse prospects than a peer who has benefited from various skills and training, offering them opportunities for career growth.”

Calls for Fair Compensation

Peter Yeo, a 52-year-old food delivery rider with seven years of experience, has voiced the urgent need for platforms like Grab and Deliveroo to enhance compensation. As gig workers endure longer hours while their earnings dwindle, the conversation about fair pay becomes increasingly critical.

The Cycle of Debt and Inconsistent Income

Debt collection agencies have started to report a troubling rise in loan defaults among platform workers, driven by soaring living costs and unpredictable earnings in gig work. The precarious financial situations many find themselves in leaves them with few options but to take on more debt.

Experts are warning that without significant changes from platform companies—such as improved pay and enhanced financial security—an increasing number of gig workers may find themselves ensnared in a cycle of unmanageable debt or compelled to abandon gig work altogether.

As the cost of living continues to rise, the financial health of Singapore's gig workers is at a critical juncture, and immediate action is needed to prevent a cascade of economic repercussions.