Read 6 min
One goal shared by new generations is to become independent in terms of personal finance and financial security. ship is higher than ever, and digital platforms have definitely made it easier to start a business and drive new models.
However, most people are not aware of the challenge of keeping a new project active and making it survive in the first year. In fact, in Mexico, only 25% of SMEs founded manage to pass their second year of operation.
In addition to the usual obstacles, we are facing a special circumstance that arises from the first pandemic of the digital age that we need to look out for.
In these circumstances, Mastercard wants to help small businesses master this new challenge.
It is particularly difficult to measure the impact of the global corona virus outbreak on SMEs, as these companies are numerous and small at the same time. However, they play an important role in the economy and in many cases are the mainstay of some countries’ economies. Straight In Latin America, they represent 99% of companiesThey contribute 30% to GDP and are responsible for 70% of the population’s jobs.
Mastercard has experienced the impact of the pandemic in all regions and, with the resulting learning, can focus on leveraging its network, technology and partnerships to help small businesses adapt to this rapidly changing environment.
Despite the fact that SMEs have suffered large losses as a result of the closure, which is intended to prevent the spread of COVID-19, new opportunities for business development arise: One of the most important is digitization.
The closure of businesses and the quarantine lead to changes in consumer behavior and a significant switch to digital payments. Therefore, business and shop owners migrate their companies to online platforms.
What we buy, where we buy, and how we pay for it will most likely change permanently. As retail makes way for e-commerce, building or optimizing a strong online presence significantly increases the chances of survival for SMEs.
In this sense, electronic payment methods and cybersecurity tools will play a fundamental role in the new business model as digital becomes the dominant trading channel.
For many years, Mastercard has been paving the way for a secure digital payments ecosystem from start to finish that includes technologies such as authentication, encryption, tokenization and the use of active or passive biometric data to ensure the legitimacy of transactions where they may happen.
Given the important role they play, support for SMEs is essential to mitigate the economic impact, preserve the jobs they create and create the conditions necessary for their future growth.
Efforts to achieve this range from private initiatives to promote local trade to large coordinated efforts by transnational companies. In this context, Mastercard has provided $ 250 million in financial, technology, product, and information resources to small businesses worldwide over the next five years. This adds to his commitment to involve 50 million micro and small businesses in the digital economy by 2025.
To help small businesses protect their business by migrating to the online world, Mastercard announced that RiskRecon, the company that owns it, will provide SMEs with free cyber security reviews by December 31, 2020.
With its ID Theft Protection solution, small businesses can better monitor and fix identity theft. Issuing banks in LAC (excluding Brazil, Puerto Rico and the English-speaking Caribbean) can register to use this solution free of charge until the end of 2020. Thanks to this solution, protecting identity during this crisis is not a concern for Mastercard SMB card users.
To help SMEs manage the impact of the pandemic, the company offers free training tools and resources through MastercardBiz and extends its content with dedicated resources, information on COVID-19, and online training from ConnectAmericas, the online business platform of the Inter-American Development Bank (IDB).
Other small business support initiatives include campaigns and incentives to encourage consumers to shop locally.
Another measure the company has taken to address the current situation is to push the boundaries of contactless transactions across the region.
“Small businesses are hardest hit by the COVID-19 pandemic and it is important that they are protected,” said Daniel Acosta, senior vice president of commercial products at Mastercard LAC. “At Mastercard, we are committed to helping you overcome this global crisis by giving you access to the resources you need to protect your systems now and in the future.”
When we celebrate the value of every entrepreneur today, we have to recognize that we believe that each of us can contribute to supporting SMEs in one way or another, regardless of whether we consume local products, support our friends’ businesses or family, Spreading information or participating in one of the myriad initiatives that have emerged to help those companies that have always been there for us.