business owner packing product

SMBs: How to leverage digital payments

By Pablo Martinez Castro, Senior Director, Visa Commercial Solutions, Visa LAC

Small and medium businesses (SMBs) are key to economic prosperity in Latin America and the Caribbean. Yet, they are also particularly vulnerable and  face some common challenges, ranging from accessing capital to manage and grow their businesses,  to improving efficiency and reaching new customers to boost their sales. In recent years, a large number of SMBs have experienced a decline in sales which has led to a  sense of uncertainty about their future. Banks and fintechs play a pivotal role in supporting the stability and recovery of this segment, not only in terms of access to financing but also by supplying the necessary support that SMBs need to grow their businesses. 

A study commissioned by Visa revealed that 33% of small business owners and decision-makers in SMBs considered managing financial services digitally extremely important, while 53% considered it very important. Similarly, two out of three respondents adopted a new approach to maintain their business, and one in three considered using less cash. For Gen Z small business owners, this latter aspect is of particular importance, as 41% of them stated that they were accepting less cash. Furthermore, different types of solutions grew during and after the pandemic: 80% of SMBs began accepting electronic payments, 83% now use online banking or their bank's mobile app, 30% of sales were done through websites, contactless cards, or mobile phones, and 80% of SMBs now use social media to communicate with their customers.ยน      

To gain and retain SMBs and strengthen the ecosystems of these client types, financial institutions and fintechs in LAC will need to expand their offering beyond financial management while remaining accessible and flexible to meet their clients' needs.

Therefore, it is essential to focus on the needs and concerns of business owners in order to provide guidance on the development of new solutions that can offer SMBs access to the new opportunities that digital payment methods can provide, thus enabling them to pay suppliers and collect money from their customers through innovative technological solutions.  This will  ensure security, safety, efficiency, access to cash flow, and control of their business. 

Financial institutions and fintechs remain crucial stakeholders in helping small businesses grow by providing financing,  offering tailored products and solutions as a way to make and receive digital payments and, more broadly, by giving advice and support for their businesses.         

Guiding in the development of solutions tailored to you

At Visa, we are committed to this initiative by delivering products and solutions that will enable small business owners to: 

1. Pay their daily business expenses by accessing their line of credit and sales proceeds through credentials across the full spectrum of SMB products: basic, everyday, T&E (travel and entertainment), and high-spend premium products. 

2. Access solutions that enable expense management and control, as well as the possibility to easily delegate expenses to employees. 

3. Make eCommerce payments through a simple, digital experience. 

4. Access broad benefits coverage to protect themselves and their business.

5. Maximize rewards by providing more opportunities to push expenses to cards. 

At Visa Commercial Solutions, we move forward in a digital-first environment. As technology opens new capabilities, we redefine the future of payments for SMBs by enabling them to thrive through products and solutions that provide better cash flow, productivity, control, and acceptance, and also, by providing our clients with new virtual solutions and frictionless payment management systems to gain increased agility, scalability and control.

Source (1): The Visa Back to Business Study / Global Small Business and Consumer Insights / Powering Recovery Through Digital and Contactless Payments Amidst COVID-19.  2021