What new challenges have appeared over the last few months for SMEs?

Many business clients that I am talking with wonder: is another COVID-related lock down likely and would it result in a shut-down of my own operations? Is my business at threat from new enterprises using differentiated business models? Will consumer spending pick up and in what area?

How are these challenges different to what we were used to?

We have reached an unprecedented dimension of uncertainty. There are multiple new factors that directly impact local businesses on many levels. This means that small and medium enterprises in particular face uncertainties how to prepare financially for the near and long-term future.

So what are financial challenges that these enterprises need to deal with?

Some businesses such as the building industry are actually doing well at the moment, and generate cash assets on their balance sheet. Their resulting challenge is to decide whether now’s the right time to invest into their business – can they hope for a pay-off over the next few years? – or to wait and find a financial product to invest into, that delivers an appropriate return in the meantime.

On the other hand, less consumer spending hit many retail and tourism-related businesses hard. So even if they are still afloat, they won’t be operating to their full effect. Their key financial challenge is to manage their cash flow and decide whether or not to draw on current financial investments.

What are the reasons why small and medium-sized business may consider investing with us?

We offer income funds that pay a monthly distribution. Even though the rates of return are variable, it can be just the missing cash flow for some businesses to survive without drawing on their assets.

Many investors go by available rates. Our Cash and Income Funds are aiming for capital stability and competitive investment returns. While there are investment risks, in the current low interest rate environment we are seeing an influx of new investment applications.

What are your hot tips for assessing an investment product?

Be clear on the reasons why you are investing and your time horizon, because you need to match any product with your businesses’ needs. A diversified strategy of investments that can be made available within a short time paired with a mid to long term portfolio may help manage manoeuvring the current uncertainties.

Apart from that, always make sure you:

• understand features, terms and conditions of the fund
• ask about what assets the fund is invested in
• thoroughly understand the risks related to this investment
• and ask yourself “Does the company have a good reputation and track record?