7 in 10 local SMEs source capital from savings, family and friends: report

SMEs spend mostly on inventory and supplies.

Seven in 10 SMEs in Singapore rely on startup capital from savings, family, and friends, according to a report by Funding Societies, a unified SME digital finance platform.

The report also found that SMEs' biggest expense is on inventory and supplies (35%).

To pay for these expenses, SMEs either opt for bank transfers (89%),  use credit/debit cards (26%), or cash (26%). 

Meanwhile, their most used methods to receive payments are bank transfers (88%), cash (41%), and credit/debit cards (30%). 

Additionally, card payments come as SMEs' most used bank and financial products (51%).

The survey also revealed that 35% of local SMEs struggle with making payments and are likewise troubled with following up on late payments from customers (58%).

Nevertheless, the business outlook remains positive, with 68% of SMEs being optimistic about their businesses.