Johannesburg, 10 Feb 2022
Are business owners likely to see a return to some kind of normal in 2022?
Critical to South Africa’s economy, small, medium and micro-sized businesses (SMMEs) have taken immense strain over the past few years as an already tough economic environment was followed by months of COVID lockdowns.
Heading into 2022, analysts predict that by the middle of the year, many developed markets and emerging markets may be able to return to “normal”. As COVID risks reduce with the increased roll-out of vaccinations, governments will be able to adopt more flexible COVID policies to manage the virus, hopefully reducing border shutdowns and other lockdown measures in the year ahead.
While there is some light at the end of the COVID tunnel, supply chain challenges, inflation and geopolitical tensions make for a complex global picture. The chance of new variants and slow vaccination rates in many countries remain roadblocks in the return to normalcy. Overall, Fitch Solutions forecasts that the global economy will grow 4.1% – above the pre-pandemic 3.1% rate – and sub-Saharan Africa is to remain steady at 3.6%.
SMEs will need all the support they can get in revitalising their businesses and using technology to reach more customers, and improving efficiencies is a key component in driving success.
An in-depth McKinsey SME report found: “Post the COVID-19 crisis, more than 65% of payments will be done using cards or means requiring POS devices; a significant drive from financial institutions can help drive uptake and readiness in businesses.”
As more people shift to digital payments over cash, local fintech iKhokha is well positioned to support SMEs in growing their businesses and at lower costs. In the month of December 2021, iKhokha processed north of R1.2 billion in card volume – and are up more than 100% year on year from a transactional volume perspective, highlighting the significant adoption of digital payments over cash in the SME space.
While many other factors will play a part in the recovery of South Africa’s SMEs, McKinsey reports: “Digital and new technologies create an opportunity for SMEs to enhance their reach and efficiency at lower costs, overcoming the scale disadvantage they have relative to larger players.”
"iKhokha has been focused on building out a true omnichannel offering, with both online and in-person digital payment solutions for SMEs, and we have also ensured that merchants using our payment solutions for both card present and online payments will get the lowest combined transaction rates in South Africa," says Graeme Cumming, iKhokha Chief Growth Officer.
Over and above card devices, iKhokha recently launched the Payment Gateway for the WooCommerce and WordPress platforms, with Wix and other popular website builder platforms to follow soon, allowing SMEs to set up online payments quickly.
As a South African founded business, they value staying close to their merchants on the ground to ensure they are addressing real business owner needs. This has resulted in a recent revamp of their mobile application, with a major focus on improving the usability, and introducing new features for merchants, including important enablers such as the ability to send pay links, and manage transactions faster.
"At iKhokha, we know how important the role is we have to play in reigniting the GDP growth of our country, and how pivotal it is for us to lead the way in giving SMEs across SA a digital footprint and the tools they need to accelerate their growth," says Matt Putman, iKhokha CEO.
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