The vital role of governments in helping small businesses thrive in a post-COVID world – Government & civil service news

Two things that united us during the pandemic were the recognition that small businesses are the lifeblood of our communities and our collective determination to keep them afloat. They are essential for economic vitality – and must be at the center of strategies to revive national economies in the emerging post-COVID-19 economy.

But in our rapidly changing world, small business owners need an increased ability to receive and make payments faster and easier, better access to capital and the tools and expertise to digitize their operations and run their businesses more efficiently.

And small and medium-sized enterprises (SMEs) in the business-to-business space, a segment often overlooked despite payment volumes totaling nearly three times that of consumer spending, have fallen behind in digitization and require more support to remain competitive in an increasingly globalized economy. Meeting this challenge represents an opportunity to capitalize on the downstream effects it can have on the SMEs that buy and supply to these B2B companies, further expanding the reach and impact.

The good news is that many governments are mobilizing. the Business Development Bank of Canada has supported small business cash flow by providing them not only with working capital loans to fill cash gaps and support operations, but also by providing purchase order financing with flexible terms to help them meet national and international orders. In Chile, policymakers have implemented the ‘Digitize Your SME’ program, which helps small business suppliers connect with buyers, by providing a tool co-created with the Inter-American Development Bank that helps business owners assess their level of digital maturity. It also offers webinars on the best use of technology, among other initiatives.

These are just a few examples of the roles governments can play and the policy tools they can use to support these businesses. In a new white paper, “Reinventing Support for Small Businesses: The Path to Building Stronger, More Resilient Small Businesses Through and Beyond COVID-19” Mastercard’s Policy Center for the Digital Economy and Kearney’s Global Business Policy Council have identified four roles governments can play to build resilience, with a focus on small business-to-business (B2B) businesses.. These are accompanied by eight broad policy objectives supported by tangible calls to action and examples of good practice in the local market.

01 Driving and catalyst for working capital and financing

This role has been particularly important in the context of COVID-19 to keep small businesses in business. By alleviating cash burdens and removing barriers that hinder the ability to receive capital – especially for women business owners and entrepreneurs of color who have been disproportionately hit hard – governments can help small businesses to operate on a daily basis. Many B2B companies need support for basic digitization efforts, or risk being excluded from global opportunities.

02 Protective

As small businesses become increasingly digital – and cybercriminals increasingly see them as targets – governments can ensure a safe and secure operating environment with regard to cybersecurity, trust and transparency. Free or subsidized cybersecurity tools, for example, would make them much less vulnerable, let alone backing up the data of their own customers and consumers.

03 Educator

There are financial and digital tools, but many small business owners – already overburdened with the task of keeping their doors open – may not know them. In addition to raising awareness of these resources, governments can also create opportunities to connect entrepreneurs with each other for knowledge sharing and business growth.

04 Convener and connector

Everyone has a stake in the vitality of small businesses. Governments can bring together – and engage – other actors, including private companies, nonbank financial institutions, development finance institutions and non-governmental organizations, by harnessing their collective expertise to support cash flow management , capital and digital services to B2B companies.

These are just a few of the ways that policymakers can take action – and these are just the starting point. Governments can link and engage with business associations to understand the weaknesses of small and medium-sized B2B businesses at a deeper level – and to create a broader support ecosystem alongside business associations, multilateral organizations and other organizations. other governments.

As the world emerges from the COVID crisis, governments and the private sector have a great opportunity to empower SMEs not only to survive, but also to thrive and position themselves to better adapt to a changing economic environment. constant evolution. Now is the time to start a dialogue between the public and private sectors on policy mechanisms and action-oriented best practices that can best increase the resilience of small businesses.

Download a copy of the full white paper here.

This article was written by Ravi Aurore, Executive Director of Global Political Affairs and Community Relations at Mastercard

For more information on Mastercard, visit their
Knowledge Partner Center

Previous Russia raises key rate to 5.5% as it struggles to control inflation
Next Federal authorities face calls for investigation into military handling of Iraq war crimes reports