B2B Payments

Checking In On The Small Business Owner


The world is preparing to enter into a new year, and small businesses are getting their New Year’s resolutions lists in order. PYMNTS checks up on the health of the small business in the U.S., U.K. and Australia and finds a few spots that could be cause for concern. Luckily, analysts expect that, with the conclusion of the U.S. presidential election and a clearer vision of what SMEs will face from markets and regulators next year, there is also a lot to be optimistic about.


$62 billion in unpaid invoices are written off as losses by U.K. SMEs every year, said Amicus Commercial Finance in a recent report. The company’s findings highlight the ongoing pressures SMEs in the nation face when dealing with late payments; according to the report, on average, small businesses write off $14,600 every year because their invoices go unpaid. Medium-sized businesses write off an average of $42,000 every year. According to Amicus Commercial Finance, the trend has also led to increased interest among SMEs in alternative finance options, especially invoice financing.


55% of SMEs aren’t sure what a personal loan guarantee is, according to the latest report from U.K. SME lender Wirefund. The company, which released its research last week, found that many small business owners are concerningly unaware of what this information is, which is often “tucked away in the small print of most business loans.” Just 8 percent said they understand the potential impact of personal guarantees and are aware that they are a requirement for high-street banks. In response to this data, Wirefund CEO and Founder Amit Sankey described personal guarantees as “opaque and outdated tools, misunderstood and misaligned with the needs of British business.”


49% of business decision makers in the U.S. are optimistic about the economy, a notably higher percentage than professionals in other parts of the world, found Bibby Financial Services. The company released its Global Business Monitor to explore how companies are feeling in the current economic climate and found that most companies (51 percent) said they are most concerned about containing rising overhead costs. Government regulation, cash flow and finding the time to run their business were also top concerns. According to Bibby Financial Services CEO for North America Ian Watson, those concerns are likely to increase into the new year.


Two in five small business owners are operating more than one company, or at least plan to, according to MYOB researchers. The cloud accounting firm offered new insight into the pressures of SME owners in Australia, and while the statistic reveals “the great Australian entrepreneurial spirit is alive and well,” in the words of MYOB CEO Tim Reed, it also means entrepreneurs are juggling a lot. The most popular reason to start another business is to generate new revenue streams, with 66 percent of SME owners citing this motivation. More than half also pointed to financial security. For the small business owners already operating more than one company, they are running, on average, between two and three businesses, according to the report.


A 0.02% decline in the latest Paychex | IHS Small Business Jobs Index certainly isn’t good news, but that doesn’t mean SMEs across the U.S. pulled back on hiring everywhere. Researchers found that, in November, East Coast businesses showed strong employment activity with a 3.42 percent increase in employment growth levels compared to a year ago. Paychex President and CEO Martin Mucci described the findings as a “tale of two coasts.” Employment fluctuation was seen across verticals, too, with leisure and hospitality each seeing increases in small business job growth, while construction and energy employment levels fell.


1.68% of small business loans in the U.S. are more than 30 days past due, representing a slight increase in the delinquency rate, according to the most recent Thomson Reuters/PayNet Small Business Lending Index. The report also found a decline in borrowing among SMEs in the country in October to its lowest levels since January. Still, PayNet CEO and Founder Bill Phelan said this delinquency rate is still below average for pre-crisis environments and noted that, now that the presidential election has concluded, the markets will gain better visibility into small business policy.



B2B APIs aren’t just for large enterprises anymore — middle-market firms and SMBs now realize their potential for enabling low-cost access to real-time payments and account data. But those capabilities are only the tip of the API iceberg, says HSBC global head of liquidity and cash management Diane Reyes. In this month’s B2B API Tracker, Reyes explains how the next wave of banking APIs could fight payments fraud and proactively alert middle-market treasurers to investment opportunities.

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