Fintech Intelligence Middle East & Africa Paytech

Mastercard Research Finds 81% of SMEs in MENA Optimistic About Future Growth

After facing unprecedented changes in the wake of the COVID-19 pandemic, Small and Medium Enterprise (SME) confidence in MENA is on the rise, according to the latest research by Mastercard.

The inaugural Mastercard Middle East and Africa (MEA) SME Confidence Index found 81% of SMEs in MENA are optimistic about the next 12 months. In fact, 77% are projecting revenues that will either grow or hold steady. Over half (56%) are projecting an increase.

Access to data, digitalisation and skills key for future growth

As many regional economies gradually enter the normalisation and growth phase, and social restrictions continue to ease, small and medium-sized businesses in MENA have identified better data and insights (42%), easier access to credit (41%) and upskilling staff (40%), as the top three drivers for growth. This highlights the opportunities for small businesses that arise from both internal transformation as well as industry regulations and trends.

Making sure that SMEs have all the support they need to go digital and grow digital is a key focus for Mastercard. The company works closely with the government, financial organisations and the wider business community to create opportunities for SMEs across the region.

Mastercard has pledged $250 million and committed to connecting 50 million micro, small and medium-sized businesses globally to the digital economy by 2025 using its technology, network, expertise and resources in support of the company’s goal of building a more sustainable and inclusive digital economy. As part of these efforts, Mastercard is focused on connecting 25 million women entrepreneurs. For many small businesses, reducing their dependence on cash through digital payments acceptance has played a major factor in being able to get paid and maintain revenues.

“The results from the SME Confidence Index clearly indicates an upliftment in sentiment that most businesses across MENA are feeling today. This is a positive sign for the region on its journey to economic recovery, and a clear indication of the power of technology in helping enable this growth. As a technology enabler of choice, Mastercard is working closely with small and medium businesses across the region to ensure that their needs are being heard and met with the latest tools and technology that can help them make the most of out of an evolving digital economy,” said Khalid Elgibali – Division President, MENA, Mastercard.

When asked about the main thing that keeps them up at night, 50% of SMEs in MENA mentioned the challenge to maintain and grow their business was their top issue. Looking at concerns over the next 12 months, over half (53%) identified the rising cost of doing business, while 39% cited access to capital. Private sector partnerships (58%) and government-led initiatives (53%) were identified as having the biggest potential to positively impact SMEs and the wider MENA market.

“With rising costs among the key concerns of SMEs in MENA, it is crucial that we prioritise a safe and secure digital economy that can keep commerce going, enable healthy cash flows, and support access to capital by virtue of a digital track record. A strong digital economy benefits everyone in multiple ways, from SMEs being able to grow their customer base through eCommerce, to consumers having a choice of payment methods. Transforming a smart economy through technology, insights and omnichannel solutions is how Mastercard supports businesses of all sizes,” added Elgibali.

As consumer trends evolve in a post-pandemic world, businesses must adapt and prepare for the future. Mastercard’s Economic Outlook 2021 estimated that 20-30% of the COVID-19 related surge in e-commerce would be a permanent trend in share of overall retail spending globally. Furthermore, recent studies from Mastercard showed that 74% of consumers in MENA are shopping more online than they did since the start of the pandemic and 95% of the region’s shoppers would consider making a purchase with an emerging payment technology over the next year.

Author

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

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