How SMBs are Leveraging Technology for Better Liquidity Management

Download the latest Embedded Finance Tracker®, a Galileo and PYMNTS collaboration. 

Economic uncertainties and inflation are giving rise to cash flow complications and capital access difficulties for many small and midsize businesses, laying bare underlying vulnerabilities in some companies’ liquidity management operations. 

As they seek to navigate this tumultuous environment, an increasing number of SMBs are turning to technological solutions to shore up their capabilities in that area.

By leveraging automation and digitization, these tech-based tools are driving efficiencies that can help SMBs stay afloat amid the current turmoil–and realize significant operational savings over the long term. 

Learn more about how SMBs are utilizing embedded finance to reduce pain points.

Liquidity management: a growing priority for SMBs.

The lingering economic effects of the Covid pandemic have exacerbated the cash flow and working capital issues that long have plagued many SMBs. 

Fifty seven percent of SMBs surveyed in a poll by Caary Capital reported having cash flow management difficulties in the wake of the pandemic, compared to just 41 percent citing such issues pre-Covid. Meanwhile, about half of executives polled in a recent Deloitte study said their organization planned to focus on improving liquidity management over the next year. 

Turning to technology for solutions.

As more companies seek to optimize cash flow and working capital management, advanced technologies are offering powerful benefits such as reduced procurement costs, faster payments and automated workflows–all of which can pay dividends in terms of both cost and time savings. 

And SMBs are taking note of the potential benefits these tools offer; the Deloitte study found that the percentage of companies planning to implement new technology for liquidity management increased by 12 percent between 2020 and 2023. 

For SMBs seeking to ride out the currently stormy business climate–and position themselves for success in the long run–it’s clear the time is now to take advantage of the powerful liquidity management tools that next-generation technology has made available.

“Companies have long been aware of the financial benefits of increasing efficiencies around B2B payments and improving cash flow management–though actually accomplishing those goals has been quite difficult, historically,” said Aaron Bright, head of B2B for Galileo Financial Technologies.

Want to Learn More?

For more insights on the growing SMB demand for tech-driven liquidity management tools, download the latest Embedded Finance Tracker®, a Galileo and PYMNTS collaboration.