Live Committed

Reconceptualise business accounting. Reimagine SME journeys

..."While many think that large companies dominate, in reality, it is over 5.5 crore (55 million) small units like yours, which drive our economy through small, manufacturing, trading and service businesses... - PM Narendra Modi

Unarguably, the Indian Small and medium-sized enterprise (SME) sector has played a critical role over decades in spearheading the country's economy. A quick look at the statistics will confirm this fact. The Indian SME sector employs around 40% of India's workforce and contributes about 8% to the nation's Gross Domestic Product (GDP).

While our socio-political climate acknowledges the small enterprises' efforts in generating economic vibrancy, it also needs to be cognisant of their predicament after the roll out of the Goods and Service Tax (GST). The new economic structure has transformed the way the small enterprises do business. There is a great need for the SMEs to quicken their pace of adapting to this new regime. Quicker the pace, sooner we will be able to raise our growth momentum.

The inside story

S. Anthony Raj Premkumar, CEO of Windcare India Private Limited - a firm with 600+ employees, echoes the latent sentiment of the SME sector. Aligning with his peers' thoughts, he opines that the transition to GST is not merely a taxation change. On the contrary, it demands a wide-ranging refurbishment in business, finance and accounting. For instance, updating the Chart of Accounts (CoA), presenting GST in financial statements, and so on.

No doubt, GST has brought with it a positive impact in the way of ease of starting business, transparency, less paper work, reduction of tax burden, enhanced logistics and market expansion. Concomitantly, it:

  • Requires multiple registrations for Pan-India businesses
  • Demands filing of returns on a monthly basis
  • Increases cost of tax compliance

With GST in force, work has taken a tumultuous turn for his team. A candid conversation with Mr. Premkumar reveals that his accounting team has to brave multiple challenges on a regular basis. For instance:

  • Working on multiple platforms
  • Manual effort causing delays
  • Duplication of work, such as issuing a cheque, presenting it to the owner for their signature, and making an entry in Tally with instrument number for reconciliation with their bank statement
  • Incorrect details, such as creating a wrong payment entry in Internet banking or cheque (wrong amount, date, and so on)
  • Calling the supplier and informing them that the payment is completed
  • Having multiple discussions with the bank about UTR details

These trials take up a lot of effort, not to forget valuable business hours.

A new way of working

To stay competitive in this age of disruption, an agile practice is the key to growth. To enable SMEs, redesign their accounting practices, financial institutions, such as DBS Bank have integrated their Net banking platform with Tally's ERP software. Calling it the DBS-Tally Connected Banking Solution, this offering helps businesses manage their E-payments, E-collection and GST payments easily.

With this service, Tally users will now have the opportunity to digitise their tax payment and accounting processes. DBS Bank's connected banking solution will ease their transition to the new tax regime and bring substantial savings in terms of time and effort.

The changed scenario

Windcare now has a lot of time to focus on the core business, thanks to DBS Tally e-payments.

All its current and future payments are created in Tally and pushed to DBS Bank in a single click. Mr. Premkumar can now track the payments on his mobile or laptop, and approve them on the go. UTR details are automatically updated in his Tally and his team hardly spends any time in issuing cheques, going to bank, making reconciliation, and so on. Also, his suppliers get a payment advice on their email, and he is informed about the payment. All of this is executed with the highest standards of encryption during transactions.

This offering has brought tangible gains to Windcare. The team can now do a lot more productive work. They also have greater flexibility at work. Moreover, Mr. Premkumar's suppliers are absolutely delighted about doing business with him, indicating more business/more credit days.

Mr. Sunil Ghadge, Partner at First Base Technologies, Mumbai too availed the convenience of DBS-Tally Connected Banking Solution. Here's what he has to say: Today, SME's main challenge is security and authentication. The biggest advantage of having DBS e-payment with Tally is that it is an automated process, where the accounting entry and the authorization of transaction takes place. Experience with DBS bank is really great. The total portal experience is very good, till date not faced any issue and the help desk is very active.

Change management

The new accounting offering redefines boundaries and attempts to redesign SMEs' work journey. It makes banking and work collaborative, innovative, agile and responsible.

Complete transformation in business accounting will be a long-drawn process. However, this offering is perhaps the beginning of a long journey toward banking and business reinvention.