Visa: More inefficiencies can be removed from legacy financial system to help SMEs


• Visa Study shows SMEs face three key challenges: cost control, securing short-term credit for cash flow, and operational competitiveness
• Seven in ten SMEs find commercial credit cards useful, but only one in ten use them. This results in inefficiencies, particularly when it comes to reconciling business from personal expenses


Majority of small and medium enterprises in Hong Kong still use bank transfer and cheques to pay suppliers and settle other expenses, but many demand more efficiency and cost savings as businesses go digital or move online, a recent Visa study on SMEs found.1

SMEs across industries seek “control and safety” as business operations are being digitized. Control and safety are manifested as the needs to have the right tools to reduce cost – which two-fifth of SMEs believe to be important – and enhancing internal efficiency (31 percent) to remain competitive.

Yet business owners and operators are faced with challenges when trying to optimize cost. Difficulty to access bank branch (26 percent) is the biggest challenge, as most prefer direct interaction with their banks’ relationship managers. High services charges (22 percent) and low level of service (20 percent) from their financial services providers are the two other pain points.

Jenny Chung, Head of Products, Visa Hong Kong, Macau and Taiwan said: “SMEs in Hong Kong are facing unprecedented challenges. They rely on their banks to meet many of their payments need such as paying suppliers and settling expenses. While they are seen as reliable, many such functions are not integrated to SME’s business operation, such as payroll or invoice management. There are opportunities for banks to optimize customer experiences to attract new users and retain customers.”

Eight in ten SMEs (78 percent) make use of short-term credit facilities, but as many as 36 percent do not pass or are not sure that they could pass credit rating process. The most affected are eCommerce and retail businesses. Forty-one percent said meeting the required documentation proved to be the biggest challenges, and 32 percent said information on the process is hard to come by.

“There is an opportunity for legacy financial services players to update the entire customer journey from acquisition to onboarding to help SMEs. Business decision-makers we have spoken to during the research process said their banks could do better than digitizing analog version of traditional services. SMEs are looking for banking services that are integrated to their accounting and tax management or expense management software, for example,” added Ms. Chung.

Visa, through its consulting services and solutions such as Visa Business Credit Score and Visa Spend Clarity, can help banks improve their SME customer journey, enhance the underwriting decision, and offer better user experiences, such as digital card issuance, to name a few. 

Visa hopes to continue to help SMEs emerge stronger from the pandemic. Last year, Visa launched the Digital Transformation Toolkit to provide all Visa Commercial Card cardholders access to the most relevant offers to tackle the key pain points experienced such as discounts when subscribing to various digital customer acquisition and relationship management platforms and tools to improve employee wellbeing and engagement. 

This year, Visa also continues to help more small businesses sell online with the eCommerce Starter Pack in collaboration with local and regional eCommerce platforms through membership subsidies and digital marketing support.


1 The Visa SME Study is a quantitative and qualitative study of 304 Key Decision Makers from Hong Kong SMEs in April 2021. SMEs are defined as firms with 100 employees or less in the manufacturing sector, or those with 50 employees or less in other sectors. Industries featured in this research include financial services, manufacturing, construction, retail, import-export, and professional services among others.


About Visa Inc.

Visa Inc. (NYSE: V) is the world’s leader in digital payments. Our mission is to connect the world through the most innovative, reliable and secure payment network - enabling individuals, businesses and economies to thrive. Our advanced global processing network, VisaNet, provides secure and reliable payments around the world, and is capable of handling more than 65,000 transaction messages a second. The company’s relentless focus on innovation is a catalyst for the rapid growth of digital commerce on any device, for everyone, everywhere. As the world moves from analog to digital, Visa is applying our brand, products, people, network and scale to reshape the future of commerce. For more information, visit About and @VisaNews.