Tag: SME

New Delhi, India – The global development institution that focuses on the private sector in developing countries, International Finance Corporation (IFC), and two investment funds managed by IFC Asset Management Company – IFC Financial Institutions Growth Fund and IFC Emerging Asia Fund – have made a US$126m (₹916 crores) equity investment in Federal Bank Limited (FBL), India’s private sector bank.

The investment aims to increase financing for climate-friendly projects and small businesses, helping accelerate the country’s economic recovery from the pandemic. Through this, FBL will be expanding its MSME and climate finance portfolios, which are keys to growth opportunities.

Federal Bank’s CEO and Managing Director, Shyam Srinivasan, shared that after the bank’s board approved the issuance of shares to the IFC group to an extent of 4.99% of the bank’s paid-up capital, IFC has become a significant shareholder of the bank. 

“The addition of this marquee name to the list of our prominent shareholders reinforces the trust and confidence reposed by the IFC group on the bank and its management. The infusion of quality capital further strengthens Tier 1 and overall CAR of the bank,” said Srinivasan.

Meanwhile, Roshika Singh, IFC’s acting country manager for India, commented that the move is in line with IFC’s strategy to support green growth by spurring investments, seizing the opportunities to help the country.

“The investment is also expected to create tens of thousands of jobs, with MSMEs gaining access to much-needed financing, which will also help ensure an inclusive recovery,” said Singh.

IFC has also announced that the investment marks the institution’s first in India aligned with the Greening Equity Approach, which will enable FBL to reduce its exposure to coal and increase its climate lending. 

With Federal Bank’s focus on ESG, IFC will also be consulting with the bank on developing a new Environmental and Social Management System (ESMS) that will be applied to its entire portfolio. To further strengthen FBL’s environmental and social sustainability (E&S) capacity, IFC will also be implementing an E&S technical advisory program. 

In addition, under the World Bank Group (WBG) Climate Change Action Plan, IFC will be putting climate action at the heart of its development work. The institution will also be working to align investments with the goals of the Paris Agreement, intensifying support to help clients decarbonize, and deploying standards and tools to catalyze private sector financing for the climate.

Singapore – SaaS cloud banking platform Mambu, which has presence in Singapore and Australia, has just recently launched a fully flexible digital solution for SME lenders that aims to cut costs and time to market.

Mambu provides banks and fintechs with loan management technology and access to an ecosystem of partners such as web-based identity authentication, credit checks, and loan origination. These partners are vital to lenders wanting to offer speedy loan approvals which has proven to be a key competitive advantage.

The new SME lending solution by Mambu is designed for fast new product launches and offers flexibility in order to quickly adapt to changes. It offers a variety of options to adjust loan conditions in order to support borrowers that are in financial difficulties. This flexibility helps clients to better serve SME companies and to release financial burdens during pandemic times.

According to the International Finance Corporation (IFC), it is estimated that there is an unmet financing need of US$5.2T every year across 65 million firms or 40% of formal MSMEs globally. At the same time, there is more pressure on SME lenders to deliver low-risk decisions quickly via a fully digital customer experience.

Elliott Limb, Mambu’s chief customer officer, shared that whether it is starting a new company or growing an existing one, there’s never been a bigger requirement for SME lenders to offer the services their customers need. 

“With Mambu’s composable approach, we provide an agile way for our clients to build and shape new financial services around the businesses they want to help,” said Limb.

Jakarta, Indonesia – In its effort to digitize the logistics industry, Transporta, the Indonesian-based transport management system startup, has launched a free trial of its transport management system (TMS) for SMEs in the logistics sector.

Transporta’s solutions give a bird’s eye-view of logistics operations through a centralized cloud platform, which enables truckers to maximize the speed of their daily operations and utilize resources such as routes, truck space, and petrol usage.

The initiative aims to assist SME truckers, with 20 or fewer trucks in their fleets, to swiftly adapt to the country’s digital migration and rise in e-commerce activity, allowing them to use the firm’s TMS services at no charge for up to 75 trips per month.

According to Transporta, the initiative also seeks to tackle two problems plaguing SMEs’ logistic processes. First is the sudden influx of e-commerce orders from retail customers, which results in SME truckers transporting goods in half-full trucks at a moment’s notice, with empty haul back to origin city and barely any route optimization. And secondly, SME truckers losing out to larger fleets due to the low level of digital adoption and the high cost of logistics solutions.

Emma Hartono, Transporta’s chief operating officer, shared that TMS solutions are expensive, bulky, and more tailored for large-scale fleets, and with this, SME truckers are left in a hard place, doing business manually with Excel. 

“Transporta is here to offer help to these SMEs. Our long-term vision is to change highly-manual traditional logistics processes via digitalization, while emphasizing building a community and digital footprint of truckers,” said Emma.

Apart from its TMS solution, Transporta also offers a telemetry system to track each truck in every fleet, providing accurate and updated location information for all assets and building a digital footprint for SME truckers. A key upcoming feature is a community platform to share payload information among SME truckers, which connects to WhatsApp group chats, allowing SMEs to quickly combine their respective fleets and maximize routes to bid on and fulfill larger orders.

Transporta has also announced that it will be debuting its cost-efficient TMS in August, with plans to onboard 10,000 trucking companies over the next three years.

Singapore – Two financial services platforms dedicated to SMEs in Asia – Opal and Funding Societies – have partnered to offer Opal’s ecosystem of clients and partners in Singapore a range of financing solutions. Funding Societies specializes in providing short-term financing to SMEs, and needless to say that this will be one of the main offerings of the partnership. 

Opal is currently operating solely in Singapore and it aims to be the unified account for all of SMEs’ payments and loans in the country. It eyes to help businesses accelerate growth by simplifying cross-border payments, maximizing cost savings, and providing easier and cheaper access to trade financing & credit facilities.

Under the partnership with Funding Societies, Opal will offer Funding Societies’ range of solutions such as micro loans, term loans, and invoice financing, at a relatively lower rate and a quicker processing time. Further, to reduce the financial burden on SMEs in Singapore, Opal and Funding Societies will reduce processing fees on all disbursals up to 50% of the loan amount and offer a full waiver of the facility fee on all line products. This is alongside Opal’s main solutions of cross-border money transfer and multi-currency accounts.

Lim Ming Wang, co-founder of Opal, refers to a study by Singapore’s MAS where growth of businesses in the Lion City is forecast to be robust but uneven in 2021. 

“As a company that is focused on SMEs in Singapore, we want to be able to assist businesses at their time of growth who are looking for solutions to strengthen their cash flow,” said Lim. 

Lim adds, “We are excited about this partnership as businesses can now have access to multi-currency management, payments, and financing solutions from a single platform on Opal. As our technology is driven by the interconnectivity of these different financial-business solutions, companies will get even better rates and faster turnaround times.”

Meanwhile, Shrawan Saraogi, head of partnerships and products at Funding Societies, commented, “As a FinTech founded with the mission to uplift economies, we believe in helping SMEs obtain access to financing solutions that are easy and fair. We want to help them by providing the impetus for growth. I believe this partnership is ideal, as we would be able to support Opal’s ecosystem of clients and partners with our wide range of growth financing solutions.”

Opal is licensed in Singapore, but has clients and client counterparties in Europe, the US, Israel, and the rest of SEA.

Hanoi, Vietnam – In response to the pandemic and its economic effects, International Finance Corporation (IFC), the sister organization of the World Bank focused on the private sector in emerging markets, has partnered with Vietnam’s international trade financing company, Southeast Asia Commercial Joint Stock Bank (SeABank), extending a US$40m loan to support businesses in Vietnam make a resilient recovery.

In the first phase of an up to US$150m financing package, the partnership aims to expand lending to local SMEs, especially women-owned businesses (WSMEs), increase access to climate finance, and boost international trade opportunities. 

The funding package will comprise up to US$80m from IFC’s own account and $50m to be mobilized from international lenders, in addition to a US$20m trade finance line. While the investment aims to increase SeABank’s SME lending portfolio, at least US$20m will be earmarked for WSMEs, with support from the Women Entrepreneurs Finance Initiative (We-Fi). 

With a strategy to expand its reach to WSMEs, IFC’s funding will help the bank triple its current WSME lending, accounting for about 25% of its total SME portfolio by 2024. IFC will also be advising the bank to develop a banking on women strategy to help bridge the US$4.9b financing gap of WSMEs, accounting for more than one-fifth of the SME financing gap in the country. The bank will further support green building and energy efficiency projects, which can help reduce greenhouse gas emissions.

SeABank’s General Director Le Thu Thuy noted that IFC’s long-term financing and technical advice will enable SeABank to focus on two strategic segments—WSMEs and climate financing—and position itself as a bank of choice for women-owned businesses and climate-friendly projects over the next five years.

“Given the pandemic, IFC’s timely investment also allows us to extend support to more businesses at a critical time while contributing to the stability of Vietnam’s overall financial market,” said Thuy.

Meanwhile, Kyle Kelhofer, the country manager of IFC Vietnam, Cambodia, and Lao PDR, shared that IFC’s new partnership with SeABank reaffirms IFC’s commitment to supporting the continued development of a strong financial sector in Vietnam.

“Our investment in SeABank reiterates our confidence in the bank and its strategic direction to increase financing for SMEs and climate investments, furthering green and inclusive growth, and helping Vietnam build back better from the COVID pandemic,” said Kelhofer.

Furthermore, IFC will be helping SeABank to support the country’s climate finance needs with US$30m to be allocated for climate-friendly projects. IFC’s support will also be expected to help SeABank build a US$60m climate-finance portfolio by 2024.

IFC’s US$20m trade guarantee line under its Global Trade Finance Program (GTFP) will boost SeABank’s capacity to provide financing for importers and exporters to minimize trade disruption given the ongoing pandemic. Participation in GTFP will enable SeABank to join a network of more than 500 bank partners in nearly 100 emerging-market countries.

Manila, Philippines – Globe’s enterprise arm Globe Business is launching a new set of programs and initiatives for SMEs, starting off with a Digistore.

The Digistore is supported by the country’s Department of Trade and Industry’s (DTI) Negosyo Center and the DTI Bureau of SME Development, which was developed to boost the sales of partner entrepreneurs through cross-selling on Globe’s digital platforms.

The Digistore will encourage Filipinos to support local MSME brands by buying from the live-selling activities hosted by Globe Business on its Facebook page.

Another one, which is also probably one of the biggest in its recent initiatives, is Globe Business’s search for MSMEs to provide them a grant to help boost their business and expedite their digital transformation. 

Globe is on the lookout for five businesses and said enterprises must have recently been proactive in tapping the power of digital technology to pivot their operations in responding to the pandemic. The telco giant will be giving an SME showcase worth ₱50,000. 

Lastly, Globe is launching a loyalty program for new and existing Globe Business customers called the Globe Business Upstart. The program is designed to empower micro, small and medium business owners through three core pillars: digital leadership, business enablement, and exclusive partnerships. Members will have access to the program starting 5 July when they register for the program.

“Globe Business is a staunch supporter of the MSME sector and is committed to being their partner for success in every way possible,” said the company.

Globe has also launched its ‘Saludo SMEs’ campaign, or which translates to ‘Salute SMEs’ – Globe Business’s annual initiative in recognizing the contribution of MSMEs to sustainable economic development. 

“Every business that has survived and beaten the pandemic odds carries an inspiring story of creativity, grit, and resilience worthy of recognition,” said the telco. 

The campaign was first launched in 2019 to shine a spotlight on SME challenges and successes and inspire other entrepreneurs facing similar struggles. Coming off a troubled 2020, the campaign message feels more poignant and emotionally-charged than ever with the theme – “Through The Changing Times, Tuloy Tayo!” or “Through The Changing Times, we continue forward!”

The campaign was kicked off through a short film depicting the humble entrepreneurial journey such as that of an ice cream vendor. The feature, which was released on its Facebook page, shows values of grit and determination in the middle of the struggles brought by the pandemic and asserts how partnering with Globe Business helps accelerate SMEs’ growth and digitization. 

Globe’s pilot short film for the campaign can be viewed on its Facebook page

“Our MSMEs have gone through their toughest year yet and through our Saludo SMEs initiative, we want to celebrate their resilience and longevity, and encourage them to cultivate a mindset of “Tuloy Tayo” in order to forge ahead with confidence into the future despite the changing times. And they can be assured that Globe Business will continue to be their steadfast partner in uplifting their businesses with innovations through our reliable digital solutions,” said Maridol Ylanan, Globe Business MSME group strategy and marketing head.

Singapore – Enterprise Singapore (ESG), the statutory board under the Ministry of Trade and Industry in Singapore, has partnered anew with e-commerce platform Lazada to reintroduce its ‘E-commerce Booster Package’, an initiative that encourages local SMEs and brands to shift to digital.

The ‘E-commerce Booster Package’, which was initially rolled out last year, has been relaunched by ESG on 16 May, with the aim to help retail businesses affected by the pandemic to diversify their revenue channels and defray business costs of going online.

Through the new partnership, Lazada will be putting together three specially curated packages, which are basic, standard, and premium, offering different value propositions to cater to different merchant appetites. The packages will help boost businesses across areas of content creation and store decoration, onboarding and incubation, as well as an advance training class, and marketing credits, among others. Each package is designed to eliminate barriers to selling online. 

Availing the package, retailers can enjoy an 80% subsidy off qualifying costs, up to S$8,000. In addition to the assistance on content and creative marketing efforts of brands, the onboarding packages will also come with marketing and shipping credits, and a dedicated account manager. 

Furthermore, under the ‘Premium’ package, valued at S$28,890, qualifying retailers only need to pay S$2,000 after the subsidies, which amounts to 93% in savings.

The deadline for interested parties to apply for the ‘E-commerce Booster Package’ via Lazada is 16 November 2021.

Enterprise Singapore’s Assistant Chief Executive Officer Dilys Boey commented that they are heartened by the support shown by industry players like Lazada who have continued to work with ESG to help retailers accelerate their move to acquire more customers online. 

“With the support of our E-Commerce Booster Package, we hope to lower the barriers for retailers to build new digital capabilities, like digital marketing or product positioning, which will not only help sustain operations in the immediate term but also strengthen their competitiveness beyond the pandemic,” said Boey.

Meanwhile, James Chang, the CEO of Lazada Singapore, said that it is part of Lazada’s mission to empower retailers and transform them for the future – as e-commerce increasingly becomes part and parcel of the way to shop, it will be an avenue that retailers cannot ignore. 

“If retailers fail, e-commerce also fails. We want to extend our hand and do our part to see merchants through this period where the pandemic is ravaging many industries, especially retail,” said Chang.

In May this year, Lazada has also announced its partnership with Great Singapore Sale (GSS), offering benefits including three months 0% commission for new LazMall sellers, as well as a free live streaming slot on the platform, exclusively for members of the Singapore Retailers Association (SRA) who take part in GSS.

Singapore – Despite a tough year for small and medium-sized businesses in the year of the pandemic, SMEs in APAC are showing higher confidence that enterprise will slowly come back on its feet this 2021, new report by CPA Australia showed. 

A survey record low of 46.2 percent of small businesses in the region grew in 2020, down from 65.8 percent in 2019. Further reflecting the challenging environment, 31.3 percent of businesses shrank last year, more than double the 14.5 percent that shrank in 2019.

This year, the survey shows that small business confidence is beginning to return, with 60.8 percent expecting to grow this year, which is noticeably higher than the 46.2 percent that grew last year.

However, for most businesses, it won’t be an immediate return to their pre-COVID-19 level. Only 14.5 percent have already returned to their pre-pandemic levels, while 58.4 percent expect to return to their pre-pandemic levels over the next two years. 

According to the study, optimism is most apparent in India, where a significant 86.7 percent of small businesses expect to grow this year, up solidly from 2020. Meanwhile, Hong Kong’s small businesses is the least optimistic, where only 21.2 percent expect to grow, with 49 percent expect to shrink or shut down this year. 

The optimism is chalked up to the expected job creation by small businesses. About 36.1 percent of the region’s small businesses expect to add employees this year.

The poor growth that resulted in 2020 was reflected in higher job losses in the sector, where businesses resorted to retrenchments and downsizing amid the halted operations brought by the lockdowns and closure of borders. In 2020, 14.7 percent of small businesses reduced employee numbers, compared with 6.7 percent in 2019. However, job losses were lower than expected because many governments in the region introduced wage subsidy schemes, like Australia’s JobKeeper, Singapore’s Jobs Support Scheme, and Hong Kong’s Employment Support Scheme.

The report said that innovation along with job creation is what will spur the recovery of businesses. The study saw that younger businesses and businesses from developing markets are more likely to be innovative. This year, the percentage of businesses that are expected to innovate is down slightly from expectations for last year – 23 percent will innovate in 2021 compared to 25.8 percent in 2020. In India, the large jump in the percentage of businesses that will innovate reflects well on its small business sector and government policies encouraging innovation.

What the report found that will stimulate growth the most are five things: selling online, innovating, improving business strategy, investing in technology, and improving customer satisfaction.

Due to limited physical activity and in-person engagements, the period of the pandemic saw small businesses increasing their adoption of technology and finally digitizing their operations. In 2020, 57.9 percent of businesses received more than 10 percent of revenue from online sales, up from 51 percent in 2019. 

Kuala Lumpur, Malaysia – Cloud service provider Huawei Technologies in Malaysia has signed a Memorandum of Collaboration (MoC) with marketing agency Vita Media, to accelerate digitalization among small and medium enterprises (SMEs) in the country.

At the center of the partnership is the aim to boost Vita Media’s information review hub, ‘Askpert’, and Huawei will be providing the needed infrastructure to improve the platform. The marketing agency will be carrying out business-to-business (B2B) collaborations in order to get SMEs to take full advantage of ‘Askpert’ in their business transactions.

Through ‘Askpert’, consumers are able to have more access to transparent and accurate information, enabling them to make more informed purchasing decisions by referring to other users’ comments and personal reviews. On the merchant side meanwhile, the review hub will be able to help them address users’ voices through their personal verdict of products and services. 

Vita Media’s CEO Kiro Tan said, “We are grateful to Huawei Cloud for their commitment to bringing affordable, effective, and reliable cloud services through technological innovation. We firmly believe that with the availability of a platform such as ASKPERT, combined with Huawei Cloud’s expertise, we will be able to improve the awareness among SMEs on the latest digital trends, thereby expanding the range of market scopes.”

Meanwhile, Huawei Malaysia’s Cloud and AI Business Group’s vice president Chee Siong Lim thanked Vita Media for choosing Huawei Cloud as its business and industry partner and reiterated the need for businesses, especially SMEs which are more vulnerable to the negative effects of COVID-19, to upskill digitally and adopt technology to give them a competitive advantage in today’s world.

“Huawei remains committed to driving digital growth among SMEs for the benefit of both businesses and consumers while supporting the Malaysian government’s vision to digitally transform the sector. This collaboration with Vita Media will leverage Huawei’s technology to improve accessibility to infotainment content and in doing so, enrich consumers’ lives,” said Lim.

Vita Media has also announced the upcoming launch of its new ‘live broadcast plus e-commerce’, which will be hosted on Huawei Cloud, with the aim to offer interesting live sales content in three languages and guarantees the lowest price for a three-hour broadcast limit throughout the year.

New Zealand – Web solutions company Crazy Domains has launched a multi-channel campaign called ‘Your Business is Better Online’, a series of ads that depict the harsh and vulgar reality of running a business offline.

The campaign aims to showcase the challenges faced by New Zealand small and midsize businesses (SMBs) when doing business in the ‘real world’. Through the series of gritty, humorous, and honest ads, the company believes that it will greatly impact the decisions of entrepreneurs to go digital.

According to Crazy Domains, despite several opportunities for digital adoption, about 37% of SMBs in New Zealand do not have an online presence, and 53% agreed they need more support when it comes to establishing one.

Mark Evans, international CEO of Newfold Digital and the owner of Crazy Domains, shared that 2020 forced SMBs owners to rethink their strategy and accelerate their digital transformation plans, regardless of whether they’re equipped for it or not.

“Businesses are finding new ways to make the most out of their web presence. And a new website or website improvements are proving to be efficient and affordable options to adapt to the aftermath of COVID-19,” said Evans.

Furthermore, the digital campaign will also be accompanied by two commercial videos, which will be running on Australia’s Metro TV, Digital TV, and billboards.