MSMEs urged to set up online businesses

MANILA, Philippines — A fast-growing Filipino financial technology start-up is encouraging micro, small and medium enterprises (MSMEs) to set up their businesses online to not only survive but thrive amid the coronavirus disease 2019 (COVID-19) pandemic that is expected to continue having a serious impact on trade and commerce in years to come. 

PayMongo Philippines chief operating officer Edwin Lacierda recommended MSMEs, which comprise over 90 percent of the country’s businesses, to set up an online business counterpart to have presence in the e-commerce landscape and augment their income. 

He said it has been five weeks since the government imposed the Luzon-wide enhanced community quarantine and, as a result, most businesses – with the exception of essential services and businesses – have been shuttered and economic activity has slowed down to depths the country has never seen.  

“Physical businesses will have the burden to regain the confidence and trust of consumers owing to the fact that there is no cure yet to the COVID-19 virus. Right now, assuming we can flatten the curve sometime soon, people will continue practicing social distancing and the effect on businesses would be fewer patrons at a time and less revenues on any given day,” Lacierda said.

“The use case and lesson learned from this present crisis is that online businesses were insulated from the pandemic. Unlike physical stores, online businesses did not close down when the quarantine was imposed. In fact, they were able to further expand their businesses as there was no other option. As a result, one can continue to sell their products or services to generate revenues and provide continued employment, as needed,” he said.

PayMongo is a Filipino fintech start-up established by four Filipinos – with funding from Silicon Valley investors such as PayPal co-founder Peter Thiel and tech start-up Stripe, among others – with a thrust to help MSMEs integrate their respective businesses in the growing digital economy.

The International Monetary Fund projected that the global economy is expected to contract by three percent. On the other hand, the Asian Development Bank expects the 2020 Gross Domestic Product (GDP) of the Philippines to slow down to two percent, assuming the pandemic can be contained by June, he said.

“Business analysts likewise believe that social distancing is the ‘new normal’ and it would take a while for consumers to regain their confidence, and areas of mass gathering will not be expected to have the same level of business activity pre-COVID-19 nor the volume of people patronizing the malls,” he said.

He said an online payment platform like PayMongo makes it easy for online sellers to get paid. 

“We aggregate payment methods such as Mastercard and Visa credit and debit cards, e-wallets like GCash and GrabPay into one platform for online buyers to choose from. Buyers need not line up and deposit their payments to the seller’s account and send a screenshot of the deposit slip. Payments are made right in the comfort of one’s home,” he said.

Lacierda said there is no need to put up a website to have an online business.

“And beauty of it is we can process payments for sellers who do not have a website to sell. They can sell online through Facebook, Instagram or on any chatgroup and PayMongo can process their payments through our PayMongo links feature,” he said.

It is this ease of payment, as well as being insulated from a pandemic, that Lacierda recommended sellers to have an online business presence. 

“I think no one will dispute that online business is a necessary component in the future of any business. And with efficient last mile delivery services nowadays and a payment platform to receive payments, it is safe to assume one can ride out any future pandemic,” Lacierda said.