Indonesia – SMEs in Indonesia rely heavily on personal funds to launch their business, according to a report by SaaS cloud banking platform Mambu; but of those that don’t rely on friends and family, short-term loans are the most popular source of funding (46%), followed by business term loans (41%), and then startup loans (24%).
According to the report, of those that are trying to secure funding, it’s the application process that represents the biggest obstacle. SMEs in Indonesia identify the greatest barriers as an arduous application process (51%) and too much paperwork and admin (37%) before a lack of sufficient starting capital (31%).
Such barriers have meant that in the last five years, 55% of SMEs in Indonesia have been unable to secure sufficient or any funding to cover the needs of the business on at least one occasion. The top three problems they face as a result include cash flow issues (37%), being unable to launch new products or services (37%), and struggling to pay back creditors (35%).
Overall, 22% of SMEs in Indonesia say securing funding is easy, while 18% say they find it to be difficult.
In Indonesia, the top three considerations when SMEs choose a lender are low-interest rates (95%), a short application process (93%) and long-term repayment plans (86%).
Meanwhile, when it comes specifically to the application process, Indonesian SMEs are most interested in faster loan decision processing (92%), low or no collateral requirements (90%) and more flexible loan conditions (89%).
