Multitude of opportunities
In addition to seeking effective regulatory support from governments, 92% of SMEs in the MEA region said they also seek support for building the skills of their teams, and 88% stressed the importance of improved telecommunications infrastructure – highlighting opportunities for positive change in broad ranging from education and skills development to systems and infrastructure advancement.
Public-private partnerships are crucial for the effective development and implementation of initiatives that advance financial inclusion and inclusive growth. To achieve this, governments and the private sector must play a joint role in creating a safe and secure operating environment.
Mastercard works closely with governments and the broader business community to advance the inclusion of SMEs in the digital economy through tailor-made digitization strategies, cutting-edge technologies, information and policy advice.
Government-led initiatives key to positive growth
In the MEA region, 51% of SMEs say government-led initiatives could have a positive impact on supporting their businesses.
These include the United Arab Emirates, where the government of Dubai has launched a third stimulus package to help small and medium enterprises maintain business continuity by reducing operational costs, while the Abu Dhabi has allocated AED 3 billion to the SME credit guarantee program. The Central Bank of Egypt has made it easier for SMEs to access capital by encouraging banks to increase their share of loans to MSMEs. A six-month debt relief financing program for SMMEs has been launched by the South African government, along with a spaza support program and an agricultural disaster support fund for smallholders and farmers communal.
Public-private partnerships, catalysts for growth
In addition, SMEs in the region recognize the great potential of public-private partnerships (PPP) and 63% believe that private sector initiatives and partnerships will benefit the companies and the markets in which they operate.
One in three SMEs (32%) believe that working with governments and companies outside their markets could have an impact on their growth. In southern Africa, this was particularly pronounced, with more than half (56%) agreeing.
The need for the public and private sectors to work together to create a better environment for small businesses was underscored in a public policy document * titled Reinventing support for small businesses, published by the Mastercard Policy Center for the Digital Economy in partnership with global consulting firm Kearney. The document presents a number of policy recommendations that highlight how effective policy and innovation can address many of the challenges facing B2B SMEs.
The main recommendations are:
- Ensure the continued stability of the working capital of SMEs by offering solutions that reduce cash costs.
- Remove barriers that hinder the ability of women-owned businesses to receive capital by making identifiers more accessible and by allowing different types of guarantees.
- Make financing and resources available to B2B SMEs to strengthen their digital capacities by offering digitization support for SMEs that buy and sell internationally.
- Ensure a safe and secure operating environment for SMEs, in terms of cybersecurity, trust and transparency, as SMEs become increasingly digital.
- Develop the knowledge of B2B SMEs on the Financial and digital tools and the resources available to them.
- Facilitate partnerships in which private entities, non-bank financial institutions (NBFIs), development finance institutions (DFIs) and non-governmental organizations (NGOs) are appropriately incentivized to provide support for the management of cash, capital or digital services to B2B SMEs.
- Improve collection, analysis and availability of SME B2B data for use by governments and B2B SMEs.
- Good practice model by purchasing goods and services directly from SMEs, embracing the digitization of payments and invoices and increasing the credibility of emerging businesses.
“Collaboration is the key to developing a business landscape conducive to future growth. Through effective partnerships, the public and private sectors can together create an enabling environment in which SMEs can thrive. The contribution of small businesses to regional economies is ultimately much more than immediate livelihood gains – it is also the sustainable development of an ecosystem that can advance inclusive growth and prosperity for all. This is why it is so important that we prioritize public-private partnerships for the growth of SMEs, and why we put our technology, expertise and global network to work, helping to develop the infrastructure to connect more people – and more small businesses, ”said Valerio Murta, Senior Vice President, Middle East & Africa Commodities, Mastercard.
Mastercard has worked successfully with regional governments to create growth opportunities for SMEs, creating an ecosystem where small businesses can thrive.
In Egypt, Mastercard worked alongside the Central Bank to develop a comprehensive national digital payment strategy and digital payroll program, to include more people in the formal economy.
Thanks to its partnership with the national payment network of Saudi Arabia, mada, Mastercard became the first company to enable e-commerce in Saudi Arabia.
In Ethiopia, Mastercard is working with the Ministry of Innovation and Technology to foster financial inclusion, support SMEs and improve digital transformation readiness.
Through technology services, e-assessments, information, grants, digital training, mentoring platforms and knowledge initiatives, Mastercard will contribute $ 250 million over five years to support financial security for small businesses in the world. world. As part of its goal of building a more sustainable and inclusive world, Mastercard has pledged to connect 50 million small businesses, including 25 million women entrepreneurs globally, to the digital economy by 2025.
Learn more about the public policy document Reimagining Support for Small Businesses, published by the Mastercard Policy Center for the Digital Economy in partnership with global consulting firm Kearney.
About Mastercard (NYSE: MA), www.mastercard.com Mastercard is a global technology company in the payments industry. Our mission is to connect and power an inclusive digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses realize their greatest potential. Our decency quotient, or DQ, drives our culture and everything we do inside and outside of our business. With connections in more than 210 countries and territories, we are building a sustainable world that opens up invaluable possibilities for all.
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© Press release 2021