42% small firms see spending returning | Economic Times

Mumbai: About 42% of small business owners in India are confident that consumer spending will return over the upcoming festive season and help their businesses stay afloat, according to a survey conducted by American Express and market research firm YouGov India. Consumer spending at shops, including those in shopping complexes and malls, had fallen drastically after the Covid-19 outbreak due to fear of contagion and lockdown restrictions in movement. There were visible signs of recovery for small businesses in August and September after sales hit “rock bottom” in April and May, said Manoj Adlakha, CEO of American Express Banking Corp India. “Merchants in some sectors are more impacted than the others,” Adlakha told ET. “We have seen entertainment and travel to be the sector hit the most, whereas billings for merchants in sectors such as pharmacy, healthcare and insurance have surged.” The survey got responses of 1,000 consumers and 300 small merchants across 10 Indian cities in the first two weeks of September. The results also pointed to rise in adoption of contactless payments by consumers and merchants in this time.“Nearly 45% of small businesses started accepting new methods of contactless payment whereas 43% of respondents have educated themselves and their staff on maintaining safety in the stores,” said Adlakha. “On our own channels, we have seen the online billing as a percentage of offline billing increase significantly.”Adlakha said that 85% of the bills generated through Amex cards were through online payment modes as against 55% before the pandemic. He added that consumers would prioritise safety and small businesses are now increasingly adopting low-touch modes of accepting payments in line with social distancing and hygiene norms.According to the survey, about 63% of the consumers said that they may resume their pre-Covid-19 shopping habits in the next three to six months and 53% said a safe shopping environment was their topmost requirement.