Singapore SME`s are facing
cash flow challenges
Company
Small and Medium Enterprises (SME) in Singapore to face difficult challenges in
their efforts to obtain financial assistance and receive timely payment.
The
findings of Study SME Banking Visa and Deloitte Digital also shows that SMEs
make up 47 percent of Gross Domestic Product (GDP) and more than 80 percent of
these companies had a turnover of more than $ 1 million.
However,
only 60 percent of SMEs to obtain bank loans for funding while 41 per cent were
not funded any financial institution. 8 percent were found to be ineligible for
SME lending.
This
paper focuses on SME across several Asean region's economic and financial
issues, banking and payments made against them.
Markets
of interest include Singapore, Malaysia, Thailand, Indonesia and the
Philippines.
Through
this study, it shows that SME are facing some financial challenges, including
cash flow and deferred payment.
A
total of 72 percent of SMEs in Singapore now requires funds to manage their
budgets better than dealing with cash flow problems, compared to 62 percent who
faced a similar situation in 2011.
Some
37 per cent of SMEs in the republic is facing outstanding payments more than 30
days, and this number is higher than SME in Asia Pacific (30 percent); United
States (32 percent); and Europe (31 percent).
The
main reason for these outstanding payments was due to inadequate liquidity,
which make up 48 percent of the reasons given.
Visa
General Manager for Singapore and Brunei, Ms. Ooi Huey Tyng, said: "SMEs
form the backbone of Singapore's economy in terms of contribution to GDP and
they are also a major source of employment.
"It
is important that SME's facilities in the description of modern finance to
conduct business operations in the most productive environment.
"Our
findings show that many SME left in the lurch to the distribution and receipt
of payment, and do not utilize electronic description. This raises the issue of
cash flow and prevents SMEs from operating their businesses more
effectively," he said.
In
addition to that, the study also showed that SMEs face the challenge of
non-financial, such as human resources and competition.
The
issue of energy supply is a major concern for SMEs, of which nearly half of
respondents said that difficulties in recruitment and the high cost of labor.
