Mistaken Payment in Singapore: Getting Money Back From the Wrong Account

Short answer: Call your bank the moment you spot the error and ask it to contact the recipient’s bank, then write to the recipient asking for the money back. The bank cannot pull the funds back without the recipient’s agreement. If the recipient refuses, a lawyer can sue in unjust enrichment for money paid by mistake.

A mistaken payment in Singapore usually happens in seconds: one wrong digit, the wrong PayNow entry, or the same invoice paid twice. Getting the money back takes longer. This guide explains what a Singapore company should do on the day it finds the error, what banks can and cannot do, the legal basis for recovery, which court hears the claim, how to record the overpayment in the accounts, and the controls that stop it happening again.

Raffles Corporate Services works with a panel of experienced Singapore law firms who offer cost-effective and efficient legal service and advice. This article is general information only and is not legal advice.

What counts as a mistaken payment, and how is it different from invoice fraud?

A mistaken payment is money your company sent by its own error: to the wrong account, in the wrong amount, or twice. Invoice fraud is different, because there the payment went where a fraudster deceived you into sending it.

With fraud, the first calls are to the bank’s scam hotline and the police. Our guide to invoice fraud when a supplier’s bank details change by email covers that scenario. With a mistaken payment, the recipient is usually an ordinary business or person who did nothing wrong and may simply return the money once asked.

Common examples in a Singapore company:

• a wrong digit in an account number, or the wrong payee chosen from a saved list;
• a PayNow transfer to the wrong mobile number or Unique Entity Number (UEN), the company registration number that PayNow Corporate uses as a proxy;
• the same supplier invoice paid twice, often once by GIRO and once manually;
• a customer refund paid at the wrong amount.

Duplicate supplier payments are often caught at month end. Our article on reconciling a supplier statement that lists an invoice twice shows how.

What should a company do in the first 24 hours after paying the wrong account?

Report the error to your bank immediately through its official channel and ask it to contact the recipient’s bank, then gather the evidence. Speed improves the chance that the money is still in the receiving account.

1. Call your bank on the number on its website or app, or use its business banking service channel, and report an erroneous transfer. Ask for a reference number.
2. Give the bank the date, time, amount, your account, the recipient’s account number or PayNow proxy as entered, and the reason for the payment.
3. Stop anything that will repeat the error: cancel a scheduled transfer, and if a GIRO arrangement caused a duplicate, check whether the next deduction will repeat it.
4. Save the payment confirmation, the screen or file that shows the intended payee, and the invoice or payroll record behind it.
5. Note who made and approved the payment, and tell a director the same day if the amount is material.

The Association of Banks in Singapore notes in its FAST FAQ that FAST transfers are credited almost instantly. After a wrong transfer, the sender’s bank will investigate and follow up with the recipient’s bank, and may advise a police report.

Can the bank reverse a mistaken payment without the recipient’s consent?

No. Once a FAST or PayNow payment is credited, the money sits in the recipient’s account, and the banks act on the recipient’s instructions about returning it. Your bank’s role is to pass on the request and report back.

The Monetary Authority of Singapore (MAS) sets out the process in Section 6 of its E-Payments User Protection Guidelines (the version in effect from 16 December 2024). Two points matter for a company:

• The Guidelines aim to protect individuals and sole proprietors. A “protected account” is one held by persons who are all individuals or sole proprietors, so a private limited company’s account is outside the formal process.
• Even for protected accounts, the Guidelines say banks are not expected to resolve each erroneous transaction. They facilitate communication between sender and recipient.

Banks may still help business customers in a similar way, so ask. The timelines below, set for protected accounts, are a useful benchmark when chasing your bank.

MAS states that complex cases, such as where a party is overseas, may take longer.

What is the legal basis for recovering a mistaken payment in Singapore?

The usual basis is unjust enrichment: the recipient has been enriched at your company’s expense, and the enrichment is unjust because the payment was made by mistake. Where the overpayment was to a supplier or customer under a contract, the contract itself may also give a claim.

A Singapore Courts case brief on Esben Finance describes unjust enrichment as a distinct branch of the law alongside contract and tort, with three elements: the defendant was enriched, at the claimant’s expense, and the enrichment was unjust. A mistake by the payer is the classic “unjust factor”.

• Mistake of fact. Paying the wrong account, or paying an invoice twice, is a mistake of fact.
• Mistake of law. In Management Corporation Strata Title No 473 v De Beers Jewellery Pte Ltd [2002] 2 SLR 1, the Court of Appeal affirmed that money paid under a mistake of law can also be recovered.
• Change of position. A recipient who, in good faith, has changed its position because of the payment may have a full or partial defence. In Info-communications Development Authority of Singapore v Singapore Telecommunications Ltd (No 2) [2002] SGHC 119 (unreported), the High Court listed four elements: the payee changed its position; the change was in good faith; it would be inequitable to require restitution in full; and the change was caused by the receipt. The change must happen after the payment.

Section 403 of the Penal Code 1871 makes dishonest misappropriation of property an offence, and illustration (g) covers a person who receives money in their bank account, discovers it was not meant for them, and keeps and uses it. Whether to investigate is for the police, and a report does not replace a civil claim. Report only facts you can support.

How do you recover a mistaken payment in Singapore, step by step?

Most recoveries end at the letter stage. Court is the last step, and court proceedings are conducted by a Singapore Advocate and Solicitor.

1. Bank request. Report to your bank as above and ask for written updates.
2. Direct request. If you know the recipient, for example a supplier or customer, email its finance team with the payment proof and ask for a refund or, for an ongoing relationship, a credit against the next invoice.
3. Letter of demand. If there is no response, send a formal demand stating the amount, the mistake, the account details for repayment and a deadline. See our guide to writing a letter of demand in Singapore.
4. Identify an unknown recipient. If you only have an account number, a lawyer can apply under Order 11 rule 11 of the Rules of Court 2021 for documents or information before action, including to identify possible parties. Our articles on pre-action discovery and Norwich Pharmacal orders against a non-party explain these applications.
5. Start the claim in the right forum (see the table below).
6. Enforce the judgment if the recipient still does not pay.

The Small Claims Tribunals can hear only the claim types listed in the Small Claims Tribunals Act. The Singapore Courts eligibility page lists contracts for the sale of goods or the provision of services among them, and excludes claims against respondents outside Singapore. An overpaid supplier or customer under such a contract may fit; a payment to a stranger’s account generally does not. Take the online pre-filing assessment first, and see our guide on whether a company can file at the Small Claims Tribunals. Ask your lawyer for a written cost estimate.

Is there a time limit for claiming back a mistaken payment?

Act quickly, even though the statutory position is unusual. The Court of Appeal held in Esben Finance that the six-year period in section 6 of the Limitation Act 1959 does not apply to claims in unjust enrichment.

That does not mean delay is safe. A claim framed in contract, for example against a supplier under the supply agreement, falls under the Limitation Act. Section 29(1)(c) provides that where an action is for relief from the consequences of a mistake, time does not start to run until the claimant discovered the mistake or could with reasonable diligence have discovered it. Delay also gives the recipient time to spend the money and argue change of position. If the amount is significant, speak to a lawyer about which cause of action to plead.

How should the overpayment be recorded in the accounts and for GST?

Record the money as a receivable from the recipient, not as an expense, and review whether it is recoverable at each reporting date. If recovery becomes doubtful, your accountant will consider an impairment.

• Wrong account: credit the bank and debit a “mistaken payment recoverable” account in the recipient’s name, with the bank reference in the narration. The intended payee’s invoice stays unpaid in accounts payable.
• Duplicate supplier payment: the supplier’s ledger will show a debit balance. Ask the supplier for a refund or to apply it to a future invoice, and keep its confirmation.

For GST, the question is whether the invoice was wrong or only the payment. IRAS guidance on invoicing customers says a GST-registered business issues a credit note to correct a mistake on an invoice or to give a credit, for example where goods or services were not supplied or charges were waived. If the invoice was correct and you simply paid too much, the value of the supply has not changed, so a cash refund normally needs no credit note; confirm the treatment with your GST adviser before you file the return. Keep invoices, credit notes and correspondence for at least 5 years, as IRAS requires for tax invoices.

What does the company secretary or accountant prepare, and what does the solicitor file?

Your finance team, accountant and company secretary build the evidence and the internal records; the solicitor sends the formal demand, makes any court application and conducts the claim.

Our sister site Singapore Secretary Services explains how board resolutions are documented.

What mistakes make recovery harder, and which controls prevent them?

The costliest mistakes are delay, an aggressive first message, and writing the amount off before trying. Prevention comes from simple payment controls.

Common mistakes:

• waiting for the monthly bank reconciliation before reporting the error;
• threatening police action in the first email to an innocent recipient, which tends to stall cooperation;
• expensing the amount instead of carrying it as a receivable;
• filing at the Small Claims Tribunals without checking that the claim type is eligible.

Controls that stop most mistaken payments:

• check that the account name your bank or PayNow displays matches the intended payee before confirming;
• maker and checker approval for every payment run, so one person prepares and another approves;
• lock the vendor master file and log every change of bank details;
• block duplicate invoice numbers in the accounting software and review GIRO arrangements when you also pay manually;
• reconcile the bank account weekly when payment volumes are high.

Our free tools help with related compliance checks.

Frequently asked questions

Can my bank simply take the money back from the recipient’s account?

No. After a FAST or PayNow transfer is credited, the recipient’s bank asks the recipient whether to return it. Without the recipient’s consent or a court order, the bank will not debit the account.

Do the MAS E-Payments User Protection Guidelines protect my company?

Not directly. Their erroneous-transaction process applies to protected accounts held by individuals or sole proprietors. A private limited company’s account is outside that definition, although many banks follow a similar process on request.

The recipient says it has already spent the money. Can it refuse to repay?

Spending the money is not enough on its own. The change of position defence needs a good faith change caused by the receipt, which makes full repayment inequitable. Spending it after being told of the mistake is unlikely to qualify.

We only know the account number. How do we find out who holds it?

Your bank may not be able to tell you who holds the account. A lawyer can apply to court under Order 11 rule 11 of the Rules of Court 2021 for information before action, including to identify possible parties.

Last reviewed: 22 October 2026. The Editorial Team, Raffles Corporate Services.