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Friday, May 8, 2020

How online banking is helping MSMEs cope with the COVID-19 crisis



Due to the current COVID-19 pandemic, micro, small, and medium enterprises (MSMEs) -- the sector frequently deemed as the very driving force of the Philippine economy -- is now in its most challenging phase yet.

Statistics from the Department of Trade Industry (DTI) show that as of 2018, 99.52% of all businesses or 1,003,111 enterprises in the Philippines are MSMEs. In addition, the MSME Development Council noted that new registered businesses in the country went up by 30,000from 1.39 million in December 2018 to 1.42 in May 2019. About seven out of ten employed Filipinos work at an MSME establishment, also based on the DTI data.

This puts the MSMEs as the most vulnerable during economic fallouts due to the small scale at which they operate. The Luzon lockdown has forced MSMEs to either pause operations completely or think of ways they could continue serving customers while complying with the government mandate. 



Fortunately, some MSMEs can afford to implement a work-from-home arrangement. They don't necessarily need their employees in-office and can easily move their entire operations online and into a cloud storage space. Other MSMEs, meanwhile, still operate amid the lockdown rely on available business solutions powered by the internet, such as social media apps like Viber, just to stay afloat.

Since MSMEs are the lifeblood of the economy, banks that have given them the initial financial push are providing them with assistance, primarily via online banking. And sure enough, there has been a significant increase in online banking enrollments and transactions due to the demand to use these digital platforms to pay insurances, bills, and process payroll.

One MSME owner benefiting from online banking during the enhanced community quarantine is The Philippine Star columnist Wilson Lee Flores, who owns the historic Kamuning Bakery Cafe in Quezon City.

Wilson bought the bakery from the founders' children in 2014. Since then, the iconic cafe has had its ups and downs, including being severely damaged by a fire caused by a neighboring restobar in 2018.

But Wilson kept the business going even while it was still recovering from the fire, taking inspiration from the movie "The Greatest Showman," by using a special tent to keep serving its patrons.

However, the bakery cafe hadn't fully recovered yet when the Luzon lockdown happened. Fortunately, Wilson has been in partnership with BDO in growing and expanding his business, and has been a user of BDO Online Banking.

"BDO is very friendly and helpful to the needs of the MSMEs in the Philippines. We are happy that customers of Kamuning Bakery Cafe have the convenience of paying us online and receiving their breads, pastries, pies, cookies, fresh milk, etc. via home deliveries,” Wilson said.

“This BDO Online Banking convenience and efficiency has helped boost our sales tremendously,” he added.

Wilson said that because of the lockdown, they had to immediately think of ways they could adjust and cope with the crisis. Now, they have a new delivery service, made possible by BDO Online Banking, which they're looking to continue even after this critical period to further expand their business.

When asked what his advice is to fellow MSMEs, Wilson encourages others operating in this sector to "tap [into] modern technologies like BDO Online Banking," along with marketing products and services through social media in order to, not only survive, but also thrive, and even compete with big businesses.

"Every crisis or problem should not cripple or paralyze us, but should make us quickly adjust and think of creative, flexible, agile ways to cope and even grow," Wilson said.

Wilson went on to say that a reliable bank is vital to the security and growth of any business, big or small, and MSME owners shouldn’t shy away from the help and solutions such could contribute for the furtherance of one’s company.

Wilson believes that the Philippine economy is just as resilient as its people and that it has a bright future ahead. It is high time for MSMEs to "work harder, have positive attitudes, think of ways to innovate always, seek ways to satisfy customers, [and] plan for expanding [one's] business," exhorted the Kamuning bakery cafe owner.

The speed at which the outbreak escalated was unforeseen and nobody could've prepared well enough for it. But it’s also in times like these that Filipinos are able to come up with the best ideas in order to keep going and face the challenges thrown their way head on.

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