SMBs Embrace-Now two plus years into the pandemic, a just released study by Visa reveals that SMB’s have high optimism (90%) about the future of their businesses, while also embracing digital payments to grow–reflecting a majority of surveyed SMBs who feel their business survived the pandemic through their use.
“Payments are no longer about simply completing a sale. It’s about creating a simple and secure experience that reflects one’s brand across channels and provides utility to both the business and its customer,” said Jeni Mundy, Global Head Merchant Sales & Acquiring, Visa. “The digital capabilities that small businesses built up during the pandemic – from contactless to e-commerce – helped them pivot and survive and, by continuing to build on this foundation, can now help them find new growth and thrive.”
The Visa Global Back to Business study found that 73% of surveyed small businesses believe that accepting new forms of digital payments is fundamental to their growth in 2022. A significant portion now or plan to implement digital payments as their only form of payment—mirroring the 41% of surveyed consumers who express a similar view.
The study surveyed small business owners and consumers in nine countries – Brazil, Canada, Germany, Hong Kong, Ireland, Russia, Singapore, United Arab Emirates and United States. A range of insight about SMBs and their use of digital payments was found:
- 54% of surveyed SMBs viewed the last year as an opportunity, reporting their business is doing well heading into the new year, up from 46% who said the same during summer 2021,
- 24% said they expect to accept digital currencies such as the cryptocurrency Bitcoin,
- Of those surveyed who had an online presence, 90% felt their survival was due to greater efforts focused ecommerce, and on average–over half of their revenue (52%) came from online channels over the last three months,
- As a majority of SMB’s expect to shift to only accepting digital payments with 41% planning to make the shift within the next two years and 64% will shift within 10 years—and 18% are cashless already,
- On the consumer side half of consumers surveyed (53%) expect to shift to cashless payments within the next 10 years, while 25% foresee within the next two years, and 16% are already using only digital payments, and
- Consumers chose to rely upon digital payments for greater ease in online shopping (47%), less risk of robbery (38%) and convenience (37%).
Most noteworthy is that 41% of consumers abandoned a purchase in a physical store because digital payments were not accepted, with younger shoppers more ready to do so. Gen Z (59%) and Millennials (55%) chose not to purchase if they could not pay digitally, significantly more than Gen X (38%) or Boomers (19%),
In addition, the survey revealed that SMBs are seeking to reach more customers online through the global marketplace, with 50% planning to increase cross-border sales in 2022. On average 68% of consumers felt comfortable buying from a business in another country or territory, while those less comfortable had concerns about fraud— for which their credit or debit card providers offer protection, such as Visa’s Zero Liability Policy.
As an international brand Visa facilitates more than 215 billion payments transactions between consumers, merchants, financial institutions and government entities across more than 200 countries and territories each year. Their global target market of 50 million small and micro businesses makes the adoption of digital payments by SMBs a top goal. To do this they established an SMB grant program in collaboration with Uber and Local Initiatives Support Corporation (LISC). T
VISA allocated $1 million for the program in which 100 merchants will receive grants of $10,000, as well as disaster recovery and resiliency guides from Uber and LISC, and placement in the Uber Eats app. LISC is overseeing the program, focusing on local Uber Eats restaurants in 10 cities: Atlanta, Boston Chicago, Detroit, Los Angeles, Miami, New York/New Jersey, Philadelphia, San Francisco Bay Area and Washington D.C.
Visa has made significant progress in their goal of digitally enable their target 50 million SMBS worldwide, having helped 24.8 million SMBs or 50% of the multi-year goal it set in 2020.
The Visa Back to Business Study was conducted by Wakefield Research in December 2021, surveying 2,250 small business owners with 100 employees or fewer in the countries previously noted. The consumer portion of the survey contacted 1,000 adults ages 18+ and 500 adults ages 18+ in those same countries.
