May 13, 2020

Digitization for SMEs

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

What is keeping SMEs in Singapore awake at night?

Higher CostSCCCI revealed that 71% (2019) companies are facing higher business costs and 54% (2019) SMEs reported a decline in profit margins (2019 ANNUAL BUSINESS SURVEY)

The interest to venture overseas has decreased from 65.1% in 2018 to 60.1%in 2019, due to the uncertain geopolitical climate (2019 ANNUAL BUSINESS SURVEY)

Overseas Expansion

65% respondents in the Singapore Business Federation 2019 survey stated the interest rate is high (NATIONAL BUSINESS SURVEY 2018/2019)

High Interest

Rate

Manpower

60% respondents feel that hiring people with right skills is a major challenge(NATIONAL BUSINESS SURVEY 2018/2019)

Cashflow

70% SMEs believe favorable financing conditions will positively

impact their businesses (NATIONAL BUSINESS SURVEY 2018/2019)

Covid 19SG economy declined sharply by

10.6% in Q12020 compared with Q42019 due to COVID-19 pandemic

(https://www.singstat.gov.sg)

Lack of Innovation

SMEs believe that innovation is a key challenge due to the cost associated with technology, lack of skilled manpower and

development of digital capabilities(NATIONAL BUSINESS SURVEY 2018/2019)

2

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

3

COVID-19 propels growth of e-commerce and SMEs should digitize to capitalize on this

34

56

7

9

11

2 23

45

67

5

6

8

9

12

15

18

38

48

60

76

96

121

153

0

20

40

60

80

100

120

140

160

180

0

5

10

15

20

25

30

2019 2020 2021 2022 2023 2024 2025

Malaysia Singapore Thailand SEA

(e-Conomy SEA 2019 Report by Google & Temasek)

Influence of COVID-19: YoY Growth Trends in Online Transactions

Malaysia Singapore Thailand

Growth of e-commerce in SEA (USD MM)

Like SARS, COVID-19 has reshaped the online shopping behaviors of consumers and corporates.

(COVID-19 Commerce Insight by Emarsys & GoodData)

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

Procurement:• Send purchase orders via ERP

platform confined to HQ office use

• Dependent on suppliers to send goods on time

Finance:• Manual reconciliation with

paper invoices• Pay multiple suppliers with

different payment methods

Sales: • Run in house promotions to

attract customers• Update menu prices according

to seasonal pricing• Manage Rewards program to

create loyalty from customer

4

F&B SME

How does Digitization help SMEs overcome challenges due to COVID-19?

Impacts of COVID-19

Procurement:• Unable to send purchase orders

via ERP platform confined to HQ office use due to lockdown

• Suppliers not able to deliver on time due to insufficient stocks

Finance:• Payments to suppliers delayed,

and need longer credit terms• Revenue has decreased by 50%

to 90%, need better cashflow

Sales: • Mitigate revenue loss with new

channel – online sales• Increase customer

engagements to boost client retention

Procurement:• Digitize the procure process with

e-orders and e-invoices• Link up with e-Procurement

platform to have effective sourcing

Finance:• Consolidate business expenses on

Business Card to improve cashflow and credit terms

• Automate reconciliation with e-invoices and save time

Sales: • Setup e-commerce shop to

generate new revenue• Gain insights and customize

campaigns to attract customers• Offer better customer experience

F&B SME

Dig

itiz

ati

on

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

5

Benefits of Digitization for SMEs

Digitization for SMEs

Savings

Payments

Cashflow Sales

Business Processes

• Improve cashflow and reduce cost of funding business • Increase revenue

• Expand outreach to customers

• Acquire new customers faster and quicker

• Manage my expenses effectively

• Streamline payment processes to suppliers

• Strengthen negotiations with suppliers

• Obtain cost savings

• Boost efficiency of business processes

• Focus more time on sales and customers

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

6

How can SMEs accelerate Digitization?

acceleratesDigitization

for SMEs

Savings

Payments

Cashflow Sales

Business Processes

How can I improve my cashflow and manage my expenses more effectively ?

How can I increase my sales revenue?

How can I streamline my payment processes?

How can I strengthen my negotiations with suppliers and increase cost savings?

How do I boost the efficiency of my business processes?

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

7

How can I improve my cashflow and enjoy interest free credit terms?

Day 1 (T)

Day T+30

Invoice due for paymentInvoice issued by supplier

Payment without cards- Offers up to 30 days credit terms

Payment with cards- Offers up to 58 days credit terms

Day 1 (T)

Day T+58

Card statement due for paymentCard statement issuedSupplier charged to card

Day T+30

Illustration on interest free credit terms for payment with cards and without cards

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

8

What happens if I am unable to pay back in full?

For UOB commercial credit card holders, they have the flexibility to:

Pay a supplier on a UOB Business Plus Card without having to pay an exorbitant amount of interest in the event full payment cannot be made on due date

✓ Payment terms of up to 60 days with 0% interest when full payment is made by due date

✓ Unpaid balances at just 1.15% per month (13.8% p.a.)

Boost cashflow and gain access to cash via UOB Business Payment Facility

✓ Choice of repayment options from one-time, 3 or 6 months installment

✓ Administration fee from as low as 1%

Leverage on payment platforms that centralizes and digitizes payments to suppliers, whilst enjoying extended payment terms

✓ Extended payment terms of up to 60 days

✓ Flexibility to negotiate for early payment discount with suppliers

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

9

How do I apply?

• Locally incorporated company

• Minimum income of S$30,000 per annum for cardholders

• Documents required✓ Duly signed Board Resolution and Card Application Form(s) ✓ Latest Year Notice of Assessment and/or two years Financials ✓ Identity documents of cardholders, directors, shareholders and appointed Authorized Signor(s)✓ Further documentation requirements advised upon assessment

• Approximately 4-6 weeks upon receiving all required documents

Basic Eligibility Criteria and Process1

I am interested and who should I contact2

• For more information, visit us at www.uob.com.sg/corporate/commercial-solutions/all-cards.html

• Email to commercialcardsenquiry@uobgroup.com

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

10

How do I streamline my payment process for my suppliers?

Buyers and suppliers have big problems today.

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

11

How do I streamline my payment process for my suppliers?

A modular, cloud-based platform can provide seamless procure to pay enablement for SMEs.

1. Lodge

Tokenised virtual card is set up for buyer and lodged in system.

2. Capture

Invoices are captured on platform or via integration with existing

accounting system or ERP.

3. Pay

Select invoices due for payment to pay.

4. Enjoy

Suppliers will receive payment within 2-5 days, while buyers enjoy up to 60 days interest-free credit.

Simplify payment process with EzyPayment

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

12

Exclusive offers for Business Owners

Offers

For all Business Owners and suppliers

• Receive fast payments within 3 to 5 Days when your buyers pay through Mastercard® in EzyPayment

• Send Payments using Mastercard® in EzyPayment and enjoy up to 60 days interest free credit for purchase of F&B supplies

• Immediate account activation

For F&B Business Owners and suppliers

• Enjoy an exclusive low transaction fee of 0.9% for your purchases

• Get EzyProcure free for the first three months (For first 500 applicants only)

• EzyProcure is a pre approved solution eligible for 70% PSG grant by IMDA

• Send and collect payments using Mastercard® cards

• Buyers enjoy up to 60 days interest free credit

• Suppliers get paid within 3 to 5 days

• Immediate account activation

BenefitsBusiness Owners

• Enjoy an exclusive low transaction fee of 0.9% to pay rental to landlord

• Get EzyProcure free for the first three months (For first 500 applicants only)

• EzyProcure is a pre approved solution eligible for 70% PSG grant by IMDA

Business Owners can email to info@sgebiz.com to indicate your interest in these offers. More info can be found at www.sgebiz.com.

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

13

How can I manage my business expenses more effectively?

A curated Corporate Gift Card programme offers:✓ Incentivise valued customers and employees

✓ Increase customer retention and acquisition

✓ Perfect for replacing physical vouchers

✓ A great corporate gift, marketing and branding tool

✓ Customisable for strong brand reinforcement

There are various options and card programmes for SMEs to reduce manual reimbursement processes and have more visibility and control over business expenses.

One such programme is the EZ-Link Prepaid Corporate programme which can help to automate, streamline workflow and meet specific needs of SMEs. It is ideal for managing fund disbursements, enhancing expense management and building corporate branding and gifting.

Corporate Expense Management: ✓ Real-time expense tracking and control of limits

✓ Simplified expense submission

✓ Availability of audit trail

✓ Direct integration with accounting software

✓ Analytical report of business expenses

Corporate Disbursement:✓ Maximises business cash flow

✓ Manage administrative efficiency

and payment processes

✓ Simplifying operational work flow

Use Case Enhancements in 2020

©2

02

0 M

ast

erc

ard

. Pro

pri

eta

ry a

nd

Co

nfi

de

nti

al.

14

Co-create your future with us.