Many SMEs in Singapore facing cashflow issues
Some 58% of small and medium-sized enterprises (SMEs) in Singapore have a financial runway that can sustain them for less than six months, revealed a survey by UOB, Accenture and Dun & Bradstreet.
Singapore came in second place out of five countries in ASEAN. Vietnam came in first, at 65%; Indonesia came in at 54%; followed by Malaysia, at 46%. Thailand took fifth place at 43%.
SMEs in Singapore face new challenges like high inflation and rising interest rates, and are concerned about the increasing costs of raw materials, rents and utilities, said Lawrence Loh, UOB’s head of group business banking, reports The Straits Times.
With rising inflation and the possibility of a recession, having over half of ASEAN’s SMEs indicating that their existing cash flow is sufficient to sustain their operations for only less than six months is indeed worrying, commented Chiu Wu Hong, tax partner and head of enterprise at KPMG in Singapore.
This is especially concerning for businesses that are cash and labour intensive, like those in the retail and food and beverage sectors, he added.