Lawrence Chan, CEO of Singapore's NETS.

How NETS is helping SMEs get the right data to raise their revenue

NETS has a network of about 10 million cards and 130,000 payment touchpoints in Singapore.

Over three-decades worth of changes and advancements in the payments industry, Singapore-based payment network company NETS’ goal remains clear: connecting communities and empowering lives.

“Our key question is always, how can we do good? How can we leverage technology, leverage our understanding of the business that we do?” Lawrence Chan, CEO of Network for Electronic Transfers (Singapore) Pte Ltd. or NETS, told Asian Banking & Finance in an exclusive interview.

Catching up with Chan at the Singapore Fintech Festival 2023 last 15-17 November, it had to be asked how NETS was going about helping small and medium enterprises (SMEs) in Singapore increase their revenue.

Putting it simply, he said that they give SMEs access to the right data. To do this, NETS is leveraging its network of 130,000 payment touchpoints and about 10 million cards in Singapore.

“We may not know them by name but from where they spend, we know that they are millennials. We will know that you own a car, because you may not use your NETS card to pump petrol, but you will use it to pay for changing the tire and repairing the car engine,” Chan said as an example to how the profiles work.

“We know the customer profile, [and] by knowing the customer profiles, we can help our merchants know who shopped with them. And we can actually then compare, not by exact name but against the industry, whether they are weak or they’re strong in certain customer segments,” he explained.
What are the current payments and technology needs of small businesses in Singapore?
For the first question, I’ll cite the Singapore Business Federation survey that was done recently as a reference. Their survey shows that revenue increase and cost declines are the top two needs of SMEs in Singapore. Digitalisation of the business actually comes at the lowest in that research survey.

This points to one fact: you don’t do digitalisation for digitalisation’s sake. You do it to impact the business. Revenue and costs are key. That hasn’t changed over the years right now. Now, with more digital assets available, the core needs to be sustainable as a business to make money, increase revenue, reduce costs, is still a very core need for SMEs in Singapore.

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Over the past year, what are the latest tech solutions NETS has rolled out?
One of the latest things we have done is we really tried to understand — with the scale that we have in Singapore — how we can make an impact on our merchants; how we can help them. Going back to the survey that I mentioned, in terms of increasing revenue and reducing costs, let me focus on revenue first.

We have the privilege of being very dominant in the face-to-face merchant space. For most face to face merchants, the biggest challenge from a revenue growth standpoint is they actually do not know who their buyers are. [For example], a small merchant sells 100 bottles of drinks a day, maybe they can remember all 100 names. But if I’m bigger, say I have two or three locations, it is very difficult for a merchant to really know who their customers are. You’ll have to ask customers to download and register [an app], and most customers will not want to do that.

Understanding the merchants is understanding that their customers are a very big part of increasing their revenue. If you do not know who your customers are [and] who you’re serving, how do you then meet their needs?

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NETS may not know each person individually like where he lives, where he stays, and what exactly he buys; but we know the customer profile. By knowing the customer profiles, we can help our merchants know who shopped with them. And we can actually then compare, not by exact name but against the industry, whether they are weak or they’re strong in certain customer segments.

Understanding who the buyers are is a key part that we can help our merchants in, not by giving them individual names, email address, no, but by the customer profile of who is buying from them. How do they compare against the competition, the industry?
In your view, what will the future of payments look like?
Okay, do you have a crystal ball? (Laughs) I believe that the future is now — and with that, we can predict what it will be like as well.

Not so long ago, we were all wearing masks, we didn’t know what the future would be. But we worked very hard during that time to do cross-border payments. So today with NETS, Singapore residents can go to Malaysia and Thailand and, likewise, when they come to Singapore, they can just scan up our QR and we can scan their QR.

During COVID, we actually worked very hard to enable these cross-border payments. The real benefit to our merchants, again, the SMEs is today for NETS, we have a large percentage of all our merchants that receive at least one cross border transaction. That means that our merchants are seeing more customers. More customers are coming to the shops. This means that we have an impact in helping bring customers to make it easier to buy things from our place.

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In addition to this, we are really looking at how we can help our merchants understand what will come tomorrow, and especially that technology will change. Technology will change, customer experiences will change. We are here really to provide an understanding of how they can grow their business; understanding of how they can reduce their costs; and hopefully we can even bring more customers through giving more payment options to them.

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