For many SMEs, cash flow has always been a careful balancing act. The risks are real: 82% of business failures are linked to poor cash flow management. According to recent reports by The Straits Times, 57% of SMEs in Singapore have less than 6 months of cash reserves. These figures underscore the urgent need for stronger, more strategic treasury practices in today’s uncertain environment. 

Unexpected tariff hikes can lead to unbudgeted expenses. SMEs with limited financial buffers may struggle to absorb these costs, leading to cash flow bottlenecks. Additionally, FED rate cuts are underway, eroding the value of cash sitting in traditional banks. Limited access to financing, thin operating margins, and a lack of long-term financial buffers make SMEs especially vulnerable during economic slowdowns. When growth stalls, these weaknesses are magnified. A perceived downturn doesn’t just affect confidence—it can directly impact liquidity, pushing already stretched businesses into dangerous financial territory.

In this climate, strengthening treasury functions and adopting more resilient cash strategies will be essential for SMEs looking to stay afloat and emerge stronger from an uncertain year ahead. In this article, we will touch on the potential changes in the coming months and how you can future-proof your business.

Table of Contents

• What’s happening in our current economic landscape?
• Cash Management Challenges Facing SMEs Today
• Essential Treasury Management Solutions for SMEs
• How SMEs Can Strengthen Treasury Operations with Syfe for Business
• How Smilie Made Their Cash Work Smarter
• Conclusion: A New Era of Treasury for SMEs

What’s happening in our current economic landscape?

Economic policies and market conditions present both challenges and opportunities for SMEs. 

FED Rate Cuts

Central banks, including the US Federal Reserve and the European Central Bank, have continued to cut interest rates to combat slowing growth and easing inflation, which is aimed at encouraging borrowing and investment. Singapore’s interest rates are largely influenced by global rates and tend to broadly follow the direction of US interest rates, hence we are likely entering a lower interest rate environment. Businesses can expect Singapore traditional banks such as UOB and OCBC to enter their second phase of rate cuts this May, with a further decline of at least 0.4 to 0.5 percentage points. Alternative banks such as ANEXT and MariBank, which cater to SMEs, are also easing their interest rates to as low as 1% per annum. While lower rates reduce borrowing costs, they also diminish returns on idle cash, impacting SMEs’ treasury management.

Trade Tariff Volatility

At the same time, global trade tariffs remain volatile, with new industry-specific tariffs and shifting geopolitical dynamics adding unpredictability to supply chains and cross-border transactions. These tariff changes can lead to higher import costs, supply chain disruptions, and currency risks, particularly for SMEs involved in international trade.

Regional Economic Policies

Regional economic policies further complicate the landscape. While countries like Singapore and Australia are adopting accommodative monetary policies, others, such as India and Brazil, are tightening policies to control inflation, creating varied conditions for SMEs across different markets. Singapore’s monetary policies are aimed at reducing inflationary pressures. Coupled with the current situation in the US, we are seeing gains against the US dollar.

Together, these factors—interest rate changes, tariffs, and regional economic policy divergence—present both risks and strategic opportunities for SMEs, demanding agile and informed treasury management to navigate the evolving economic landscape.

Cash Management Challenges Facing SMEs Today

The current economic climate has made cash management even tougher for SMEs. Current challenges of SMEs heightened by recent market impacts include:

1. Cash flow volatility resulting from economic uncertainty – With ongoing uncertainty, it’s harder than ever to predict when money will come in or go out. For SMEs that don’t have large cash reserves, this unpredictability can put daily operations at risk.
2. Working capital optimization in a changing rate environment – Managing working capital has also become trickier. Borrowing may be cheaper with lower interest rates, but keeping too much cash sitting idle earns little return. Business owners now have to carefully balance how much cash to keep on hand versus how to put it to work effectively.
3. Currency risk management with fluctuating exchange rates – When exchange rates move unpredictably—due to global interest rate changes or trade tensions—SMEs trading in multiple currencies can lose out if they’re not protected. Proper currency risk management is now essential, not optional.
4. Supply chain financing impacts from tariff fluctuations – Tariffs are adding another layer of complexity to supply chain financing. Higher import costs can squeeze profit margins and disrupt inventory planning. On top of that, banks and lenders may ask for more documentation or offer less favorable terms, making trade finance harder to secure.
5. Investment strategy adjustments needed due to interest rate shifts – SMEs need to rethink how they invest extra cash. Traditional options like time deposits now offer lower returns. To make idle funds work harder, businesses should consider low-risk, flexible investment tools such as money market funds or short-term bond funds.

Essential Treasury Management Solutions for SMEs

SMEs can equip themselves with a range of treasury management tools in order to build resiliency during uncertain market conditions. Such tools include:

1. Digital Cash Management Platforms

• See all your business accounts in one place, track payments easily, and reduce manual work. 
• Many tools connect directly with your accounting software E.g. Aspire, Xero, QuickBooks

2. Automated Liquidity Tools

• Know exactly how much cash you need and when. These tools help you avoid overdrafts, reduce idle cash, and stay prepared for unexpected expenses. E.g. Cashwise, Oracle NetSuite Cash 360

3. Short-Term Investment Options

• Make your idle cash work harder. Consider low-risk options like money market funds or short-term bonds for better returns than a regular savings account. E.g. Syfe’s Cash+ Flexi and Cash+ guaranteed solutions

4. Supply Chain Financing

• Improve cash flow by getting paid earlier or extending payment terms with suppliers—without damaging relationships. Digital platforms make this easier than ever.

5. Currency Hedging Made Simple

• If you deal with foreign currencies, protect your business from rate changes using easy-to-use FX tools like forward contracts or multi-currency accounts.

6. Real-Time Dashboards

• Get a live snapshot of your cash position, upcoming payments, and currency exposure. Make quicker, smarter decisions with all the data in one view.

How SMEs Can Strengthen Treasury Operations with Syfe for Business

In today’s rapidly shifting economic landscape small and medium enterprises (SMEs) must rethink how they manage their cash and liquidity.With tools previously reserved for large corporations now accessible to SMEs, platforms like Syfe for Business are empowering business owners with better control, visibility, and returns on idle cash. Here’s how SMEs can take action across four key treasury areas.

Strategy A: Optimising Treasury Operations During Interest Rate Cuts

With UOB and OCBC cutting savings account rates (and more reductions expected from May 1), SMEs can no longer depend on traditional bank deposits for meaningful returns. Inflation erodes idle cash, while big players continue to benefit from better strategies.

Solution:
SMEs can turn to short-term investment vehicles like Syfe’s Cash+ Business, which allows companies to earn higher returns on idle funds while keeping daily liquidity. These managed portfolios invest in money market instruments and short-duration fixed income assets—designed to preserve capital and beat low deposit rates.

Syfe for Business Enables SMEs To:

• Earn more on idle funds without locking them up
• Manage operating vs. reserve cash more effectively
• Gain real-time visibility on returns and balances

Strategy B: Mitigating Tariff Impacts Through Strategic Cash Positioning

Tariff increases and trade disruptions raise import/export costs and add strain to supply chains. SMEs with tight cash cycles may face working capital gaps during delays or cost spikes.

Solution:
Businesses should align their cash positions with procurement cycles, build buffers in foreign currencies, and optimize payment terms. With Syfe, SMEs can segregate strategic reserves from operating capital—ensuring access to liquidity even when tariffs hit margins.

Syfe for Business Helps SMEs:

• Create flexible buffers that support supply chain volatility
• Hold and manage cash across time horizons and needs
• Strengthen treasury planning without extra headcount

Strategy C: Building Resilience Through Diversified Banking Relationships

Relying on one bank exposes SMEs to service disruptions, unfavorable rates, and limited FX support. A diversified treasury strategy spreads risk and improves access to smarter financial tools.

Solution:
Pair your core banking setup with a platform like Syfe to diversify where you hold and grow cash.

With Syfe for Business, SMEs Can:

• Unlock better returns across multiple providers
• Gain professional-grade investment access without complexity
• Get transparent insights and reporting—no in-house treasury needed

Strategy D: Technology Investments to Improve Treasury Efficiency

Manual cash management is time-consuming and error-prone. SMEs need smarter tools to monitor, manage, and make decisions faster.

Solution:
Modern platforms like Syfe for Business offer real-time dashboards and performance tracking —all tailored to SME needs.

What Syfe Offers:

• Real-time visibility into performance and balances
• Automated portfolio management with professional oversight
• Easy integration with your business’ existing financial tools

Action Plan: Reassessing Your Treasury Function in 5 Steps

1. Map your current treasury workflows
   Identify pain points in cash planning, visibility, and decision-making.
   
2. Assess the impact of rate cuts, tariffs and exchange rate changes
   Understand how lower yields and trade costs are affecting your bottom line.
   
3. Segment your cash into operational vs. strategic pools
   Allocate working capital for daily use and invest the rest for yield and resilience.
   
4. Explore new platforms like Syfe for Business
   Compare returns, liquidity access, and ease of use against traditional options.
   
5. Commit to quarterly treasury reviews
   Regularly reassess your setup in light of macro shifts and business growth.

How Smilie Made Their Cash Work Smarter

Smilie, a fast-growing rewards and gifting platform, was sitting on idle cash reserves that were earning next to nothing in a traditional business account. As a digital-first company, they needed a flexible solution that allowed them to earn better returns without compromising liquidity.

By adopting Syfe for Business, Smilie was able to deploy excess cash into Cash+ Business, earning significantly higher yields through professionally managed money market funds. The platform’s real-time dashboards allowed Smilie’s finance team to monitor returns, cash segmentation, and liquidity daily—freeing up time, enabling smarter treasury planning that ultimately benefitted their ad-hoc expenses and enhanced employee welfare.

“Syfe gives us the ability to not plan so far ahead but also have the benefit of having some returns. The returns we have gained from Syfe have helped us fully cover our ad-hoc entertainment costs and provide additional benefits to our clients.”

Wen Hao Dong, Smilie Co-Founder

Conclusion: A New Era of Treasury for SMEs

In 2025, SMEs are facing an inflection point in treasury management. With interest rates falling, tariffs fluctuating, and economic conditions shifting rapidly, the old ways of managing cash are no longer sufficient. Today’s environment demands agility, visibility, and smarter use of every dollar.

Businesses that proactively reassess their treasury operations—by leveraging new tools, diversifying where they hold cash, and optimizing liquidity strategies—will be far better positioned to weather uncertainty and unlock growth. Platforms like Syfe for Business are democratizing access to institutional-grade treasury capabilities, giving SMEs the power to take control of their financial future.

Cash management is no longer just a back-office function—it’s a strategic lever that can drive resilience, agility, and long-term success. SMEs that recognize this shift and act decisively will emerge not just stronger, but smarter.