Brazil: Small Business Migration to Digital Triples in Pandemic

Small and medium-sized companies show signs of recovery with a 4.5% increase in sales until August, shows Mastercard.

The new coronavirus pandemic has forced small and medium-sized businesses to reinvent themselves to get through the crisis. According to a survey by Mastercard, the number of Brazilian companies that migrated to the digital environment grew 208% in 2020, compared to the volume of transactions in 2019.

Worldwide, insertion in the online medium was three times higher than at pre-pandemic levels and peaked in July 2020. According to Mastercard, the increase reflects the increased demand for a virtual sales channel, plus the slight delay after lockdowns were adopted.

“The move to digital has opened the door to the bright side of the pandemic: a resurgence of entrepreneurship and innovation,” says Mastercard Chief Economist, Bricklin Dwyer. Now, he points out that the time is ripe for “brighter opportunities” in the coming months.

With the presence of 19 economic markets, the report Recovery Insights: Small Business Reset reveals that sales of SMEs (Small and Medium Enterprises) lagged behind those seen in larger companies by up to 20 percentage points in the worst moment of the pandemic.

However, small business spending recovered in 2021 with a 4.5% increase in sales through August 2021, a period in which e-commerce sales jumped 31.4%.

According to the study, the number of new small retailers in 2020 grew by a third compared to the result of 2019, and the number was almost eight times greater than that of the creation of large companies. The trend of opening new SMEs in 2020 happened all over the world, especially in the United Kingdom (+101%), United States (+86%), Australia (+73%), Germany (+62%), Canada (58%) and Brazil (+35%).

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Small and medium-sized companies show signs of recovery with a 4.5% increase in sales until August, shows Mastercard.

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