- Latest research by Mastercard shows high digitalization among women-owned businesses as opportunity for broader SME recovery and digital economy growth
- 79% of the South African women entrepreneurs have an online payment method in place according to the Mastercard MEA SME Confidence Index
Despite having to contend with gender disparities, women entrepreneurs in South Africa are bridging the digital divide and have adopted and integrated digital solutions into their businesses on a scale comparable to their male counterparts. In new research by Mastercard, women-owned small and medium enterprises (SMEs) believe there are huge benefits of a cash-free economy to their businesses.
According to the inaugural Mastercard MEA SME Confidence Index, 79% of women entrepreneurs have an online payment method in place, which is on par with their male counterparts. In terms of a digital footprint of South Africa’s women entrepreneurs, social media (94%) leads the way, followed by a company website (91%).
From presence to payments, digital and cash-free economy leads
According to the Mastercard survey, confidence levels around digital transactions are high with two-thirds (67%) seeing no challenges to accepting more payments digitally – especially card payments (45%) and mobile payments (41%).
Growing confidence levels in digital as a business imperative, is tied to a deeper understanding and wider recognition among SMEs of the advantages that result from a growing digital economy. When asked about the biggest benefits of a cash-free economy to their businesses, women entrepreneurs highlighted the increased efficiency of transactions across multiple channels (90%).
They also appreciated having a more convenient way of paying suppliers and employees (89%), faster access to revenues (83%), the ease of not handling cash (79%), credibility with banks and government (79%) and less potential for fraud (76%).
For many small businesses, reducing their dependence on cash through digital payments acceptance has played a major role in being able to get paid and maintain revenues. Eighty nine percent of women SMEs agreed that digital and online payments are important in helping them grow their business, 86% lauded the safety and convenience of contactless payment technology, while 77% conceded that their customers prefer to pay through digital methods since the outbreak of the pandemic.
“Women small business owners are showing resilience and incredible adaptability, despite having to navigate lockdowns, and restricted supply chains due to the Covid-19 pandemic. While several challenges remain, it is encouraging to see how women-owned SMEs are transforming the way they do business to benefit from the digital tools including safe and convenient electronic payments solutions that are currently shaping commerce,” says Suzanne Morel, Country Manager for Mastercard, South Africa.
Women-owned SMEs optimistic about the future
While the majority (85%) of South African women-owned SMEs say that the pandemic has negatively impacted their revenue, looking forward however, 82% are projecting that their earnings will either hold steady or grow in the next year.
Women SMEs in South Africa identified ‘better data, analytics and insights‘ (54%) as the top area that offers the highest growth potential for their businesses, closely followed by ‘upskilling staff for the future’ (51%) and ‘access to training and development support’ (49%).
When asked about what keeps them up at night, 43% of women SMEs in South Africa mentioned being ‘able to maintain and grow their business’, while 24% are worried about staying in business or going bankrupt. Looking ahead at the next year, more than three-quarters (77%) identified the rising cost of doing business, 61% cited red tape and regulations, and 50% mentioned getting access to capital as their biggest business concern.
“At Mastercard, we want to help as many women-owned businesses to reach their full potential as possible. Last year, we made a global commitment to connect 25 million women entrepreneurs to the digital economy by 2025 by providing them with the tools, training and solutions they need to survive and thrive now, and in the future,” says Morel.
In addition to empowering women-led businesses everywhere with digital payments acceptance tools, Mastercard is also advancing social progress through financial literacy and training to encourage the growth of entrepreneurship among women. Through its partnership with Junior Achievement South Africa, Mastercard has empowered over 3,000 women to gain entrepreneurial skills, start their own ventures and create new jobs.