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MORE than half of Singapore's small and medium enterprises (SMEs) - 60 per cent of those surveyed - expect overseas business activities to drive revenue growth this year, but challenges related to regional financing have to be tackled, the latest SME Growth and Financing Survey found.
Besides the lack of familiarity with overseas markets and difficulty in identifying suitable domestic partners while venturing overseas, 70 per cent of SMEs found it challenging to access funding without a proven track record in the host country.
In the light of that, the study recommended that SMEs leverage the strong Singapore brand and find the right banking partner with regional networks to achieve sustainable growth even as firms internationalise.
To effectively conduct business in foreign markets, 42 per cent of respondents said they would engage another banking partner in the host country, while one in three preferred appointing a banking partner in Singapore with cross-border financing solutions.
Notably, Vanessa Leung, head of commercial banking, Standard Chartered Bank Singapore, proposed that using a bank with a large branch network might enable a business to manage its finances better, since the bank will be able to understand the company's operations in Singapore and integrate that with its activities in a foreign market.
Jointly organised by the Singapore Business Federation and StanChart, the study focused on key areas such as business growth outlook, expansion in Asia, financing needs as well as regional agreements such as the Asean Economic Community and Trans-Pacific Partnership.
Amendment: Standard Chartered Bank Singapore's Ms Leung was referring to both local and international banks with a large branch network in the home market.