Southeast Asia’s SME landscape, as revealed by Funding Societies’ recent report, paints a picture of resilience and innovation. The study, encompassing 1,000 SMEs across Malaysia, Singapore, Indonesia, Thailand, and Vietnam, highlights the region’s entrepreneurial spirit amid challenging economic times.

In Southeast Asia, 70% of SMEs kickstart their ventures using personal savings and support from family and friends, showcasing the region’s strong community ties. Traditional banks contribute 23%, while 7% turn to alternative sources like FinTech companies, as unveiled by Funding Societies, the largest unified SME digital finance platform in Southeast Asia.


Payment Preferences: Bank transfers dominate, with 90% of SMEs using this method for transactions. Surprisingly, cash transactions remain significant, particularly in Indonesia (51%) and Malaysia (63%).

Top Financial Concerns: SMEs across the region express worries about timely payments to suppliers. Access to financing, payment approvals, and invoice matching also weigh heavily on their minds. Singapore stands out, emphasizing the challenge of receiving payments from customers.

Product Preferences: Business term loans (49%) reign supreme among SMEs, except in Singapore and Vietnam, where card payments take precedence (51% and 49%, respectively).

Expense Patterns: Daily operations (32%) and inventory/supplies (32%) dominate SME expenses. However, Vietnam diverges, emphasizing employee salaries as a significant expense.

Brand Loyalty: Low interest rates significantly influence SMEs’ brand loyalty, especially in Singapore, where 62% are open to switching brands due to dissatisfaction.

Empowering SMEs in an Evolving Landscape

Chai Kien Poon, country head of Funding Societies Malaysia, emphasized the need for tailored financial solutions, stating, “Innovative financial platforms like Funding Societies bridge the gap, providing essential support for MSMEs to thrive in our ever-changing business landscape.”

Funding Societies’ report sheds light on the evolving SME sector in Southeast Asia, offering valuable insights for policymakers, financial institutions, and entrepreneurs. To access the full report and country-specific highlights, visit here.


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