According to a recently published Joint Whitepaper by Kearney Consulting and Business Spend management platform, EnKash, India’s business spends, which currently stands at $6-$7 trillion, could reach $15 trillion by 2030.
These include the spends of large corporates, mid-market enterprises (INR 5-250 cr. turnover), and a rapidly growing ecosystem of start-ups. That the number of companies being registered month-on-month has doubled over the past six years (as per Ministry of Corporate Affairs data), indicates that India Inc is on a path of sustainable growth.
While the pandemic triggered the mainstreaming of digital payments, both at a consumer and enterprise level, there is far greater value in end-to-end evolution, in the form of comprehensive automation and digitalization of payments and payment processes – spend management.
Spend management is a far more holistic perspective to review and examine the entire flow of spends, including outgoing monies, order-to-cash processes (accounts receivables), purchase-to-pay (accounts payable) cycles, recurring expenses, reputation management, savings, growth among others.
The effectiveness of spend management relies on two factors. First, digital penetration, and second, operational efficiency. In contrast, when SMBs and start-ups manage payables and expenses manually, it is a slow paperwork intensive process that often comes with delays. The ensuing inefficiencies are obvious: poor vendor management leading to a loss of reputation, late payment fees due to delays, and overall increased efforts during audits to trace the approval trail.
What businesses need is an easy-to-use-and-configure end-to-end B2B spends management platform to help them move toward digital penetration and operational efficiency.
One of the leading examples of a spends management solution is India’s leading and fastest-growing company EnKash. The company offers a range of finance solutions, including Payables & Expense Management, Receivables, Corporate Cards in partnerships with reputed banks, and a plug-and-play cards issuance stack, CardX.
The payables solution helps SMBs onboard vendors, create approval hierarchies and payment processes for recurring payments, and statutory payments like GST or Bill Payments that have an auto-fetch and reminders feature for timely payments.
A mid to large corporate can get benefited with 50% less TAT while making critical payments like utility, GST and bill payments for different locations. It also helps in decentralising the whole vendor payments process with more control and process efficiency.
In fact an effective spends management platform could offer up to 40% increase in process efficiency, while reduction of manhours by up to 30% and enhance organizational savings by 30%.
Now compare this to manual accounting. Manual accounts receivables depend on the memory of the finance team and paper invoices to ensure that collection requests are sent on time.
Sending reminders would require an assessment of which customers have paid and then sending reminders to the rest. The process of matching the cash and bank balance would require a lot of effort. The result would be poor cash flow and customer experience.
On the other hand, a digitised accounts receivables solution helps send invoices to customers on time along with embedded links that enable various payment modes, and reminders in case of missed payments to speed up collections.
It also ensures real-time updates in bank and finance records to improve efficiency. Additionally, the DIY and transparent platforms enable flexibility to clients, allowing them to decide limits on different spending’s which enable mitigation against the risk of fraud.
The corporate card also cannot be further allocated to other key people within the company for usage without the guidance of the original issuer. Moreover, its usage can be tracked in real time, instead of being dependent on the monthly statement generated, enabling spend managers to monitor card use and swiftly prevent misuse.
Also, one could enable 40% higher corporate spends as compared to other available cards in the market. For instance- vendor payments would not be possible in other available cards.
The corporate card solution, in partnership with reputed banks, includes a credit card with collateral-free credit, a range of prepaid cards for specific expenses like rental payments, reimbursements, utilities, etc, and a gift card solution to meet corporate gifting needs.
All aspects of the card can be managed by the free AI-enabled dashboard that helps spend managers create, issue, track, manage, block, and unblock the cards as required.
All these solutions, which are part of a comprehensive corporate spends management platform, enable SMBs and Start-ups to move towards digitalization and increased operational efficiency.