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Empowering SMEs through optimized payments

16th May 2016Presenter: Adam Jones, MasterCard

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Cash flow: the movement of money into or out of your business.

Cash flow is vital because its the:Biggest challenge for 1 in 3 small to midsize businessesMain reason why 45% of businesses fail in the first five years.

Pay / Be Paid

The definition of cash flow is simple the movement of money into or out of your business. The management of it can be anything but.Why you should careStudies shows that:1 in 3 SMEs see cash flow as the biggest challenge45% of small businesses that fail in the first five years cite cash flow as the major cause.Best practices: Get paid by customers ASAPDelay outgoing payments as long as possible Forecast cash flow to maintain solvencyControl your cash flow through visibility Predict what your cash balance will be in six months.3

Getting paid without delay

Top 5 tips

1. Discounts to customers who pay early2. Ask customers to pay upfront3. Issue invoices promptly4. Follow-up on slow payments5. Make it easy for your customers to pay you

According to the Federation of Small Businesses:70% have experienced late payment in the last 12 monthsTwo thirds had to write off their invoices with 20% losing 5,000 or more.Source: http://www.fsb.org.uk/rle-cashflow Top 5 tips to get paid in a predictable and timely way:1. Provide discounts to customers who pay early2. Ask customers to pay when they hire you or place an order3. Issue invoices promptly4. Follow up if payments are slow5. Make payments easy for your customerAccepting credit cards is a great way to get paid quickly and have full visibility into your incoming payments. Also, card is an electronic payment and electronic payments are fast, ensuring that you get paid quickly.

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Making payments made easier

1.Speed doesnt pay

2.Take full advantage of payment terms

3.Consider instalment loans

4. Use a credit card to get an extra 30-45 days of time to pay

5. Pay electronically for better visibility and control of your expenses

Simple ways to extend the timescale for making payments:1. Take full advantage of payment terms2. Use a credit card to get an extra 30-45 days of time to pay3. Using a card is a great way to pay because it:a. gives visibility into your expenses b. creates value-added benefits and rewards for your businessc. drives efficiency from your financial processesd. provides you with a negotiating tool with suppliers.

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Mind the gap

Why keep personal and business expenses (or payments) separate?

Get a clear view of business expenses

Delegate spending to employees

Gain control with online management and reporting.

Highlight the differences between business and personal cards:Separate business from personal expenseProvide cards to employees to delegate spendingRobust online management and reporting

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Time is money in Abu Alis world

Meet Abu AliGreat as a plumber, not so good at cash flow management. He's a typical tradesman with constant cash flow challenges

He needs a trusted advisor.

Cash flow is a constant challenge for Abu Ali . Heres why:Ordering supplies upfrontPaying salaries and other third partiesAbsorbing late payments Monitoring cash flow and job-by-job profitabilityWorrying about electronic payment securityLink to next slide: one of Abu Alis biggest challenges is that paying in cash can be a hassle. That's where MasterCard can help Abu Ali and many small business people like him and you.

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How MasterCard can help today and tomorrow

Were a technology payments company that connects and facilitates payments between cardholders, merchants, financial institutions, governments and businesses.

We are a technology company. Lets swipe away some MasterCard myths. What we dont do:Issue cards Set interest ratesEstablish annual fees.What we do:Connect cardholders, merchants, governments, and businessesFacilitate payments between 2 billion cardholders and tens of millions of merchantsProcess payments at 130 milliseconds per transaction.8

At MasterCard, we believe that Your Business is Our Business.Small to midsize businesses are 90% of the private sector and employ almost 80% of workforce.

CBE is providing 200 billion Egyptian pounds stimulus pack plan to fund over 350,000 SMEs over the next 4 years.

MasterCard is dedicated to serving the needs of small and midsized businesses, which are the backbone of the Egyptian economy accounting for more than 90% of the private sector and employ almost 80% of workforce.

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Electronically Control your payments

Clear benefits for employers, cardholders and every bank

Reduce risk & operational burden

With MasterCard security and fraud prevention options, you can allow employees to make payments directly while managing visibility and control.

Features include:Corporate Liability Waiver: Protects the company against unauthorized use of card by its employees, up to a maximum annual amount of $25,000 per Cardholder and $1,600,000 per Company.Fraud insurance: Cardholders can be reimbursed up to $2,000 per claim and a maximum of $4,000 over a 12 months period for unauthorized charges on their lost/stolen MasterCard or for charges that the cardholder did not approve while the card is in their possession.

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Evolving payments with cardsIn 2013 MasterCard in partnership with the Egyptian Bank Company under guidance from the Central Bank launched the 1st Open Mobile Payment Platform allowing the Banked/Unbanked to Exchange Money Over the same platform.

Cash on Delivery, Supply chain collection for SMEs

In 2015 payments for tax, utilities & telcos have become available online

In 2013 MasterCard launched in Egypt the first Open Mobile Payment Platform allowing the Banked/Unbanked to Exchange Money Over the same platform.

Soon we will also facilitate more online payments options other than Utility bills, such as:

Paying Customs

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Go beyond cash to drive your business forward

Card advantages

1. Safer and more secure

2. Faster and more convenient

3. Greater control and insight of spending

4. Empowering the SME

Focus on the advantages of card over cash and how their impact on your cash flow can give you a competitive advantage.12