How FinTech Companies In India Are Helping Indian Businesses Navigate Compliance Challenges In Spend Management

The World Economic Forum, which recently concluded its annual business conference in Davos, stated that financial technology companies are thriving in India. After a period of funding challenges and regulatory uncertainties, 2024 is expected to be positive for the industry. It is good news for not just financial technology companies but also small and medium-sized businesses (SMEs). The SMEs rely on FinTech organizations for financial inclusion and regulatory compliance. More importantly, these companies have been facilitating operational excellence through automation platforms such as a spend management platform. 

Before financial technology companies digitalized spend management workflows, organizations depended on manual paper-based processes to facilitate and monitor business spending. This not only complicated cash flow management, but also opened businesses to fraud and regulatory issues. With a spend management platform, SMEs can simplify accounts payable and receivables through efficient invoice and vendor management. More importantly, it allows Indian businesses to navigate compliance issues.

Let’s see how financial technology companies are addressing regulatory roadblocks for organizations in India.

FinTech Enables Compliance in Spend Management

By facilitating digital transformation in spend management, financial technology companies have revolutionized the way businesses handle compliance. But before we discuss the influence of FinTech in compliance management, let’s understand the common challenges that SMEs face.

• Organizations spend valuable time on manual work using spreadsheets and data entry, where mistakes are bound to happen.
• Traditional spend management processes rely on paper documents to monitor and track financial details like accounts payable and receivables.
• Lack of centralized data, companies are often blind to compliance requirements that make them susceptible to fraud and other risks.

All of these challenges have been solved by financial technology companies like Zaggle.

Avoid penalties for late payments

Spend management platforms digitize accounts payable processes, which involves faster, automated approvals to process invoice payments. With expedited vendor payments, companies can avoid fines, penalties, and even legal actions for late payments. With Zaggle’s spend management solution, you can configure multiple approval workflows giving you flexibility based on department, bill amount, and due date.

Eliminate data entry mistakes

Mistakes seep into spend management processes when they are handled manually. It could be as simple as a typo changing the account number or bill amount. Regardless of the gravity of the error, companies will have to pay for irregularities. However, the solutions provided by financial technology companies navigate this compliance issue by introducing the power of AI in spend management. For example, Zaggle Zoyer automatically maps invoices with respective purchase orders to ensure accuracy.

Configure alerts & reminders for deviations

Stakeholder approvals are major bottlenecks in clearing vendor invoices. For finance teams, it becomes an operational burden to repeatedly follow up so that the payments can be processed. With the emergence of FinTech, companies can now create automated workflows so that relevant stakeholders are looped in as per requirement. Additionally, you can set alerts and reminders to notify the necessary manager regarding the pending vendor payment.

Ensure centralized data for efficient tracking

The spend management solutions designed by financial technology companies empower SMEs with comprehensive visibility into spend management processes. They can generate reports and analyze financial data to identify spending patterns, which they can then use to create efficient practices. These reports can also be used to identify cost-saving opportunities and detect instances of fraud like duplicate invoices and inflated bills.

Streamlined tax filing and audit trials

One significant area that most companies fail to be compliant with is tax regulations. Due to the lack of proper documentation, SMEs end up grappling to get the necessary paperwork ready during tax submissions. Organizations can ensure compliance with tax rules using financial technology solutions by maintaining detailed documentation. It also helps in streamlining audit trials adding to the compliance strength of the business.

Zaggle smoothens the route to compliance for businesses

Ensuring compliance across spend management tasks allows you to rein in cash flow fluctuations. It also enables financial management that can lead to sustainable growth. It is no secret that financial technology companies have facilitated this transformation by digitalizing end-to-end spend management workflows. Zaggle has been a pioneer in providing fintech solutions to SMEs allowing them long-term benefits. As one of the few unicorns in India, Zaggle provides specialized automation platforms for different financial operations including expense management, employee benefits, channel partner rewards, and spend analytics.