A Mastercard survey has highlighted the challenges faced by small and medium-sized enterprises (SMEs) in Kenya and across the globe due to inefficient payment systems.
According to the Borderless Payments Report, about 45% of SMEs and 42% of consumers fear they might become victims of fraud in digital cross-border payments.
The survey, which involved 7,586 consumers and 3,074 representatives of micro, small, and medium-sized enterprises in various markets, revealed that payment service providers have been blamed for poor pricing, where about 40% of consumers and 45% of businesses say cross-border payment systems provide poor foreign exchange rates, high transfer fees, or both.
“About one-third say digital platforms are not transparent enough about how much transfers will cost and how much money will be received,” the report says.
Furthermore, one in three consumers say cross-border payment platforms have limited options for delivering funds by the recipient’s preferred method.
Despite the challenges, the survey found that majority of businesses believe that sending digital cross-border payments would improve the efficiency of any business (79%), help the business grow (72%), improve the business’ cash flow (69%), and allow business to survive (69%).
Mastercard Executive Vice President Stephen Grainger emphasized the importance of seamless international payment services in keeping families and businesses financially connected and the global economy moving.
“Of all consumers surveyed who sent a cross-border payment last year, around 40% said their family members would not have survived financially without the funds,” he said.
“About 70% of SMEs surveyed say the global payment network helped them endure the pandemic.”
