Small businesses are optimistic about revenue growth prospects: report

KARACHI: Most small and medium-sized businesses (SMBs) are optimistic about their prospects for revenue growth in the coming year amid economic recovery, a report from a financial technology company said on Thursday.

In order to better understand SMBs’ aspirations and challenges, Payoneer, the financial technology company that enables these businesses worldwide to transact, do business and grow, recently conducted a survey with nearly 3800 SMBs, including 252 from Pakistan. The survey highlighted their goals, achievements and challenges in the dynamic global marketplace.

A significant 71 per cent of SMBs in Pakistan express confidence in their ability to increase revenue over the next 12 months, with 63 per cent expecting improvements in the health of their local economies, said Payoneer’s SMB Ambitions Barometer Report 2024.

Globalization is key to any business, but it is imperative to SMBs because they often need to spread their wings to keep their big dreams aloft. The surveyed SMBs in Pakistan actively engage in global commerce, with the US, China, UAE and the UK being the top markets for sending and receiving payments. This reflects a strong inclination towards international trade and collaboration.

“Small businesses in Pakistan are diversifying customers and vendors, indicating some resilience and agility against external threats.” In line with the survey average, 62 per cent say having a diverse and global vendor network helps protect small businesses from disruptions, the report said.

Despite their ambitions, SMBs in Pakistan face several barriers to global expansion. The cost of doing business, including shipping fees and foreign transaction rates, is cited as a top challenge by 39 per cent of respondents, according to the report. Limited access to capital and high debt-to-income ratios hinder their growth potential.

Technology as a catalyst: The report indicates that 56 per cent of SMBs in Pakistan believe that digitization has lowered barriers to entering the global market. Furthermore, 74 per cent recognize the pace of technological change as a driver of innovation, highlighting the need for adopting advanced technologies to remain competitive.