To complement our South African roadshows last week in Johannesburg and Cape Town, we held a media brunch in Cape Town for local journalists. Gary Turner, Xero’s MD EMEA and Colin Timmis, Xero’s SA Head of Accounting, hosted journalists at Clarke’s on trendy Bree street. They talked about everything from late payments to South African fintech over a delicious breakfast and coffee.
The challenge of late payments
In light of recently released Xero research on the effect of late payments on small businesses, Gary noted that getting paid on time was the biggest challenge for half of South Africa’s SMEs.
The research also showed that late payments cause cash flow issues for 32% of businesses. Another 18% blamed them for reduced morale and 16% felt that late payments result in reduced productivity.
This is a significant issue, as SMEs currently contribute an estimated 53% of the South African GDP employing 52% of the workforce. Eradicating the negative trend of late payments is therefore key to boosting this success.
Gary noted that technology could significantly reduce the burden of late payments for SMEs. This gave rise to a discussion on the various aspects of financial management that can be made easier with the help of technology.
Many of the journalists in attendance observed that South Africa is increasingly embracing fintech. They recognise the major benefits it could have for the country and its economy.
More and more people are paying for goods and services through applications like SnapScan, which enables the user to scan a barcode with their phone to make a payment. This effectively removes the need for cards and card machines and enables more small businesses to accept non-cash payments.
SnapScan has also partnered with WeChat to offer a mobile wallet service. Users of the WeChat app can send each other money and pay for goods and services either from money in their WeChat Wallet or through a linked SnapScan account.
Xero have also just announced a partnership with Sasfin to offer South Africa’s first direct bank feed. Sasfin Bank customers who use Xero will be able to import and categorise their bank statements automatically. This will save them valuable time and give them added insight into their financial position. The collaboration is yet another way in which Xero is enhancing and adding to the financial ecosystem.
Xero also partners with many other businesses, both in South Africa and around the world. We have more than 500 apps that currently offer integration with Xero. Watch this space for more announcements in 2017 on new South African integrations and partnerships.