Singapore SMEs on road to recovery, but challenges remain: report

NEARLY three quarters of small and medium-sized enterprises (SMEs) in Singapore expect their businesses to recover from the pandemic by April, with up to a third of them saying that their operations have already recovered, a Mastercard study has found.

The study, which polled 306 small business owners in Singapore and concluded at the end of last year, found optimistic sentiments among local SMEs in Q4 2020. Ninety-five per cent of the respondents said they have enough resources to navigate 2021.

The report also showed that some business have already taken steps to boost their operations. Twenty-three per cent of business owners are making investments to prepare for economic recovery, while 56 per cent of them have already established or expanded their online presence to increase their reach to customers.

Yet, some key challenges remain, Mastercard noted. Labour, sales and financing were three aspects that small business faced difficulties in, with 72 per cent, 62 per cent and 54 per cent of respondents respectively naming these as their difficulties at the end of 2020.

In addition, a third of these SMEs (34 per cent) indicated plans to move towards non-cash payment options. This comes amid the accelerated adoption of digital payment services due to the Covid-19 pandemic.

Said Deborah Heng, country manager for Mastercard Singapore: "Though the pandemic has presented Singaporean businesses with some truly unprecedented challenges... many SMEs here have weathered the storm - due to their own willingness to innovate, evolve and adopt new ways of doing business that meet the needs of consumers."

She added that the commercial landscape is now "more digital, more fast paced, and more fluid".