Indian businesses and SMBs have untapped potential, says Sharma
The business spends market in India is at an inflection point with an ever emerging need to transform age old processes in business spends management, says Hemant Vishnoi, Co-Founder of EnKash India.
EnKash and global management consulting firm Kearney have produced a whitepaper ‘Rising Digital Business Spends: Managing a US$15 trillion India Opportunity’.
“Through this insightful whitepaper in association with Kearney, we aim to identify key challenges and list down potential solutions that will drive the digitization of the business spends value chain.
“Given the thriving small to medium size businesses & start-ups business landscape in India, an all-in-one business spends solution can create large value and improve overall business efficiency,” he said.
Shashwat Sharma, Partner, Kearney, noted, “The Indian businesses, specially the SMBs, have untapped potential that is currently consumed by manual processes across the operations, specially payments.
“India is progressing on the digital penetration and has an opportunity to improve operational efficiency, as analyzed by The Kearney Global B2B Index.
“Growing the industry from US$7 trillion (approx.) to US$15 trillion by 2030 will require a collaborative effort of leading fintech players like EnKash, Government and Regulator.
“The whitepaper analyzes the initiatives undertaken and the incremental steps that can be catalytical to growth of the industry and digital adoption,” said Sharma.
Key highlights in the paper:
Of the 64 million businesses in India, there are about 3-4 million businesses which have shown rapid progress in digitizing business spends. These include large corporates, mid-market enterprises (Rs.5-250 crore turnover) and a rapidly growing ecosystem of start-ups.
On the digital front, large businesses are front-runners in adoption of innovative technology, having transitioned to digital modes enabled by ERP integration along with use of commercial credit cards in many cases. SMBs are slowly migrating to the digital modes while micro enterprises and retailers are perceived to be cash and cheque intensive, followed by NEFT payments.
Kearney Global B2B Index measures the operational efficiency and digital penetration in business payment ecosystem across countries – highlights India significant ahead in digitization, but more room to improve payment efficiency.
Key Challenges in the business spends value chain:
Businesses in India are still operating on a manual processing model, wherein a team is deployed to process the invoice and upload the payment, while the payment itself is online. While corporate players are digitizing the steps involved in the process, the medium, small and micro players prefer maintaining a mix of manual and digital processess.
Medium & small enterprises might leverage standalone solutions for each element, integrating them for cohesiveness. These enterprises aspire growth and progression which drives them to adopt the latest technology for digitizing and simplifying processes. Some might use manual databases to run the whole process, relying on manual rechecks as a validation. Unfortunately, these also require manpower muscle on account of manual operations and need for maker-checker at each step.
Small, medium and micro businesses’ face a paucity of working capital which hampers their ability to scale operations.
Groundwork to address the challenges is underway- Fintech led solutions across three elements of the value chain: product proposition, digitization and customer acquisition platforms.
EnKash is India’s first Spend Management and Cards platform that became operational in 2018. Since its launch, EnKash has helped over 100,000 businesses to digitize and decentralize their corporate payments.
Kearney is a global consulting partnership in more than 40 countries. fiinews.com
