How HomePay is combating renovation scams in Singapore

Money is put in an escrow account and disbursed when milestones are reached.

In October 2023, the Singapore Police Force arrested a man for allegedly swindling a total of $198,000 in a series of renovation scams– just one example of the thousands of renovation-related complaints that had been reported in the Lion City. From 2021 to early 2023, over 3,300 complaints were logged, according to data from the Consumers Association of Singapore; and between 2021 to 2022, over $1.16m in prepayment losses due to sudden business closures were reported.

These cases inspired David Ng– who was the group chairman of a tech solutions company– to launch HomePay, a local app designed to redefine payment practices for both interior designers and clients.

“HomePay was created to solve a very simple problem. And that problem was that a lot of cases reported of either interior design firms running away with the money that was put on deposit by homeowners when they agreed to a renovation contract; for when the work is done to a substandard workmanship level, leaving homeowners not happy and unwilling to pay,” Ng told Asian Banking & Finance in an interview.

Ng noted that there is a lack of regulation in the industry, or a lack of yardstick that could properly measure what should be the right standard of workmanship or quality of materials.

“We hope that we can help to reduce the risks in that industry and try to solve that problem from both the homeowner's side and the interior designers' side,” Ng added.

HomePay— whose financial wallet system is approved by the Monetary Authority of Singapore– serves as a platform to connect homeowners with interior designers. Before onboarding an interior designer firm onto its platform, a vetting process is done via a “Know Your Business” process to ensure that the company or its directors do not have any bad records. 

“Both sides have to be vetted and cleared right before they can use the platform,” Ng said.

Data of transactions between the company and individuals will be stored in the back-end administration of HomePay, which will allow them to see the timelines of when contracts have been uploaded and whether said timelines have passed, every milestone met, and every payment dispensed.

“What we've built in HomePay is a system whereby they can actually document the entire renovation journey. First starting from the contract-- that was agreed upon, what the scope of works are, quoted pricing, work progression, work images or documentation of work completed for each stage-- and they can actually check, because everything has been properly documented before the first dollar is actually awarded to the contractors. So, both sides have peace of mind,” Ng said.

Payments are uploaded to an escrow account with DBS, with HomePay disbursing the payment automatically once certain milestones in the written and uploaded contract have been met.

Currently, the app– which launched just in December 2023– is privately funded, and as of now has no intention of doing a funding round. 

Right now, HomePay is focused on scaling up operations. Ng shared that the app recently partnered with an equipment manufacturer that has hundreds of interior designers working with them, and HomePay is in the process of training and onboarding all these IDs into its platform.

Further developments in the works include a warranty tracker; an invoice tracker; a mood board for users to sort out different styles of renovations they may be keen to explore; and a directory to facilitate homeowners in finding credible ID firms.

“We also plan to put in some rating system where people that have completed projects on our platform can read the IDs or read the contractors for how good their job is, quality of their workmanship, or how painless or enjoyable that process was [working with the contractor],” Ng said.