A Mastercard Middle East and Africa (MEA) SME Confidence Index has revealed that 74% of SMEs in construction and manufacturing are optimistic about the next 1 year. 76% projected revenues that will either grow or hold steady, while half (50%) are projecting an increase.
As regional economies gradually enter the normalization and growth phase, SMEs in the MEA region’s construction and manufacturing sector have identified different activities as vital for growth. Such activities include upskilling staff (56%), easier access to credit (56%) and better data and insights (52%), as the top drivers for growth.
For many small businesses, reducing their dependence on cash through digital payments acceptance, has played a major factor in enabling payments and maintaining revenues.
Mastercard has pledged Ksh. 27.5 billion ($250 million) and committed to connect over 50 million MSMEs globally to the digital economy by 2025 using its technology, network, expertise and resources. This is in support of the company’s goal of building a more sustainable and inclusive digital economy.
“As manufacturing and construction businesses continue to build back better through a combination of digital transformation and people development, they are also encouraging other SMEs in this sector. At Mastercard will look forward to a seamless continuation of supporting the SME ecosystem, providing the payments technology infrastructure and wider business solutions that will spur wide, inclusive growth of the digital economy,” said Amnah Ajmal, Executive Vice President, Market Development, Middle East and Africa, Mastercard.
The report also revealed that 54% of regional SMEs in construction and manufacturing mentioned the challenge to maintain and grow their business was their top challenge. Looking at concerns over the next 12 months, 60% identified the rising cost of doing business, while 47% cited access to capital.
Operational concerns for the next year include maintaining current staff levels (47%), training and upskilling staff (44%), finding the right talent for new needs (39%) and mental and physical wellbeing (39%). This highlights the growing trend around the development of people as a key theme for small business success.
Furthermore, SMEs in construction and manufacturing businesses expressed need for support, management and upskilling teams (55%). SMEs in this sector also want access to a wider range of financial services (55%) and effective regulatory support from government (54%).
In 2020, a Mastercard study showed that 73% of consumers in the Middle East and Africa are shopping more online than they did since the start of the pandemic.
Consumer passion for the environment is also growing, with 70% of consumers believing it is more important for businesses to conserve the environment.