Sebastián Kreis
Co-Founder and Co-CEO
Xepelin
/
Expert Contributor

Supporting SMEs to Support Mexico

By Sebastian Kreis | Tue, 05/03/2022 - 17:00

In this time of economic and social uncertainty, the ability of Latin Americans to adapt has been put to the test on more than one occasion. Technological adoption and the migration of operations to digital environments were lifelines for a large number of companies that were forced to scale their infrastructure in the face of the latent threat of having to close their doors.

According to the World Bank, the COVID-19 pandemic gave rise to the biggest global economic crisis in more than 100 years. In 2020, activity fell in 90 percent of countries, the global economy shrank by around 3 percent, and poverty increased worldwide for the first time in a generation.

SMEs, which are the economic engine of Mexico, have had to learn to cope with the economic challenges that the world has gone through in the last decade and it has been through their own financing that many of them have stayed afloat. For a long time, these companies have been the most forgotten and neglected segment by traditional financial services, which has caused many of them to close their doors because they could not continue financing their operations.

Small and medium-sized businesses play a vital role in Mexico's economic performance and the main reason they close has to do, almost always, with a lack of access to financing. This is an urgent need to address.

Today, we can close that gap with technology and investment. There is a direct correlation between access to financing and the digitization of SMEs’ operations and their growth over time. Today, it is possible to find almost all services and experiences in a completely digital way, from the provision of public services, to banking and finance.

Business owners are used to receiving payment on their invoices in 30, 60 or 90 days. If we were to reduce that number of days to one or two, the impact on the value chains of companies would be immense and would undoubtedly be reflected in the economic movement of the region.

The arrival of fintech and the rapid digitization of operations give small and medium-sized entrepreneurs the ability to access unique, innovative and easy-to-use tools that allow operators and business owners to automate their recurring operations and focus on fully attending other areas of their business.

Fintech companies must be seen as the financial ally of SMEs and we must put them at the center of all our operations. We have the economic capacity to be an agent of change that facilitates access to financing. On a daily basis, we seek new sources of financing that allow us to provide the necessary tools that entrepreneurs require to grow and scale. That's what we work for.

Democratizing access to financing is a pending debt with small entrepreneurs. We must not forget that a successful SME generates a growth ecosystem around it and that ecosystem has a direct impact on people's pockets and on the economy of countries and regions. Supporting SMEs is supporting Mexico.

Photo by:   Sebastián Kreis