Amex reaching out to SME sector

Singapore

AMERICAN Express (Amex) is often seen as an imposing brand, but it is looking to change that perception as it reaches out to small and medium-sized enterprises (SMEs) with tailor-made financial products like its business travel credit card launched on Thursday.

Geoff Begg, senior vice-president and general manager of American Express global commercial services for Asia Pacific, told The Business Times that the financial services provider sees strong growth in the SME segment regionally and globally, but these businesses are struggling to obtain the funding they need.

"SMEs are a big proportion of businesses, and they're growing strongly, but they really need help. They're worrying about how to grow their businesses, and struggling with cashflow and looking for partners," he said.

Noting that 99 per cent of Singapore businesses are SMEs, and the segment contributes about half of the country's gross domestic product, he added: "It's incumbent on us, from a business point of view, to help them in their time of need as they're trying to grow their business."

Small businesses have difficulty negotiating for benefits and obtaining the credit they need, and Amex hopes to help with the American Express Singapore Airlines Business Credit Card.

The card's benefits include the ability to earn both HighFlyer points for the company and KrisFlyer miles for the employee on Singapore Airlines Group flights, complimentary travel insurance, airport lounge access and up to 51 interest-free days for all spending.

"If you're a small business, sometimes it's very difficult to negotiate the best deal with a big company, because you don't have volume, you're not a major spender," Mr Begg said. "What we're doing here is aggregating an offering for SMEs in totality... It gives them the benefits of being a larger company while they are still a small company."

A survey of 200 SMEs by Amex and Singapore Airlines (SIA) found that SME owners travel at least once every six weeks for business and 70 per cent of SMEs have employees travelling two or more times per month.

Nine in 10 have dealings overseas, and one in three cited lack of access to capital and cash flow as key obstacles to their international expansion.

However, 46 per cent of them also do not use corporate credit cards at all, relying on debit or consumer cards instead. Celine Chua, Amex Singapore vice-president and general manager of global commercial services, said: "About 20 per cent of SME employees complain about having to put business spend on their personal cards and get reimbursed later. This card will eliminate these issues."

Mr Begg said: "This product is targeted at SMEs and we hope it will meet their needs. They can grow and become mid-sized, large or global companies, and we have the product portfolio to grow with them."

Amex plans to offer more products to meet the key concerns it has identified among SMEs, like cashflow, convenience, security and international business. Its strategy will involve leveraging its wide range of partners and designing value propositions that will meet SMEs' unique needs, Mr Begg said.

He added that SMEs in the region are concerned about globalisation, digitalisation and geopolitical issues like trade wars, but remain fundamentally optimistic.

"About 74 per cent of them expect to grow in the next 12 months. The engine room of Singapore is saying, 'I'm excited about the future. Yes, there are challenges, headwinds; I have to be nimble; there's growing competition. But I'm backing myself to be successful in that environment.' That's really exciting."