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In 2018, Bank Negara conducted a survey to better understand the financial needs of SMEs. According to the survey, approximately 1530 SMEs participated which covered firm and entrepreneur characteristics, business performance and challenges, as well as access to finance and usage of financial services. 

53% of the respondents used professional services including auditors, accountants or financial advisors to manage their financial accounts. Having to outsource their accountants and not being able to do it on their own has proven to be somewhat of a hassle when it comes to keeping track of their businesses. However with Biztory, anyone can use our cloud accounting software, including those who don’t have any background in accounting. 

Despite the challenging business environment, 71% of SMEs recorded profit margins of above 10% and were able to maintain positive cash flows, claims Bank Negara. Bank Negara says sources of financing also vary through the business life cycle. For example, during the formation stages of SMEs, business owners and entrepreneurs are more likely to receive funding from friends and family or through micro finance institutions. This produces less risk and lesser interest to be paid back and is easier compared to other loans.

Did you know? Grab is also offering micro financing options for certain SMEs! Click here to know more! 

Most of these firms obtained unsecured financing from micro-finance institutions, banking institutions and development financial institutions. Bank Negara states that about 44% of the respondents were first-time borrowers. On average, 89% of the applications were approved within one month and the funds were distributed within the next month. The survey also provided insights on SMEs’ usage of other financial services, such as insurance, takaful and e-payments. Surprisingly, more than half of the respondents own takaful products and insurance, even though it’s less common amongst SMEs. 

The survey also noted that SMEs mainly utilise electronic payments, providing numerous payment gateways to their customers. Speaking of which, Biztory now offers JomPAY as a new payment gateway option! For merchants using Biztory, you will now be able to fill in your JomPAY details (Company ID and Biller Code) and it will automatically be included in your next sales invoice. Sending the invoice to your customer will allow them to use this payment option so all you have to do is wait for you to receive your payment.