KUALA LUMPUR (Sept 20): Digital payments remained a key driver for digitalisation for small and medium enterprises (SME) in Malaysia, the American Malaysian Chamber of Commerce (Amcham) said.
Amcham said a report by online payment system operator PayPal on “Accelerating SME Digitalisation in Malaysia” has reinforced the need to enable digital payments to accelerate SME digitalisation.
“Digital payments became the key driver for digitalisation during the pandemic. While the report found the majority of Malaysian SMEs are domestically focused, [an] increasing number of SMEs are pivoting to cross-border trade and internationalisation for new customers, expansion and growth,” it said in a statement on Tuesday (Sept 20).
It said the report, which is based on a survey of 1,000 SME owners across Malaysia, examined the digital readiness of Malaysian SMEs, analysed the progress of their digitalisation efforts and impact that digitalisation has had on their ability to sell cross-border, and identified solutions to address challenges, as well as to capture new opportunities.
Amcham said among findings of the survey was that 67% of SMEs accelerated digital payments for health and safety concerns, 57% for instantaneous receipt of payments, and 53% to enhance customer experience.
It said 58% of SMEs had digitalised their ability to make and receive payments, followed by advertising/marketing and customer service; while 92% accepted some form of digital payments from their customers.
Amcham said over 40% of SMEs sell to international customers, with the Asia Pacific region having the highest share of cross-border sales for SMEs at 48%, followed by global (42%) and Southeast Asia (39%).
It said nearly 70% of SMEs who conducted cross-border business agreed that having digital payment options had enhanced the trust and credibility of their brand and attracted international customers.
Chief Executive Officer Siobhan Das said SMEs are an integral part of the ecosystem and are also a critical part of the global supply chain.
“MNCs (multinational companies) rely on the resilience and growth of SMEs to ensure continuity and stability in their ability to deliver value to global clients.
“This requires predictability and standardisation to ensure compliance, and can only be achieved if they adopt digital technologies,” she added.