Small and medium sized enterprises (SMEs) which make up the backbone of Singapore’s economy are increasingly turning to digital transactions to collect money from their customers.
DBS has seen a 70% increase in digital transactions from its SME customers and 25% increase in transaction value since the bank launched DBS MAX, a mobile-based QR payment collection solution in Singapore four months ago.
Adoption of DBS MAX has been steadily expanding with close to 2,000 merchants and 3,000 over outlets across Singapore, enjoying the ease and convenience of this “plug and play” digital payments collection solution. DBS MAX has been most popular among the bank’s SME customers in the F&B and retail sectors for its flexibility. They can sign up for DBS MAX instantly and collections at cashiers or outlets can be enabled and maintained on the DBS IDEAL website. In addition to store-front collections, DBS MAX is also increasingly replacing cash in B2B and B2C last mile deliveries.
Francis Looi, CEO of Polar Puffs & Cakes Pte Ltd, said that the customers now are becoming more familiar with digital wallets and so he has had to keep up with the times. With DBS MAX, it has also been easier to balance the books at the end of the day and employees have also had less cash to deal with. “With DBS MAX, my staff are happier as there is less cash handling and fewer trips to the bank to deposit money and get the right denominations for change at our outlets island wide. As a result, the Polar team can now focus more on customer experience and think up new ideas for delicious cakes and pastries.”
Bernardine Ho, General Manager of Retail, Planet Telecoms, added that DBS MAX brings more convenience to customers thus improving retail experience. “We have always believed that cashless payment is the way forward in order to remain relevant in an increasingly digital age, especially since we are at the forefront of the retail telecoms industry. DBS MAX will not only help us in our digitalisation efforts but will provide our customers with a better and more seamless retail experience.”
For SMEs adopting digital forms of payment collection, DBS MAX eliminates the time and effort in managing and depositing cash in banks. In 2015, it was estimated that the cost of processing cash is about SG $ 2 billion a year, or 0.5% of Singapore’s Gross Domestic Product. This is the amount that businesses collectively, especially small businesses, can potentially save.
Businesses have since recognised the ease and advantage of using DBS MAX and have embraced digital collections in a big way. In the first four months of 2019, overall cash transactions for SME customers using DBS MAX have significantly decreased by about half. This co-relates to the over four in five Singaporeans who are already using some form of e-payment, as digitalisation brings about more ease and convenience. This trend is set to continue with the increase in digital payments collections solutions targeted directly at SMEs such as DBS MAX.
Jasmin Ng, Group Head of Cash Product Management at DBS Bank, said, “Cashflow is the lifeblood of SMEs. One of the key challenges for SMEs is the ability to achieve sufficient liquidity while balancing expenses. As a bank, we are constantly looking at how we can innovate to help SMEs optimise their working capital, while streamlining their collections and payables process. DBS MAX has proven to be successful as DBS has enabled SMEs to plug into the digital ecosystem in a simple, secure and straightforward manner and resolves current pain points of cash and cheques handling.”
