Centralized Control Over Expenditures: The Key To Streamlined Financial Management For Startups

A whopping 38% of startups fail because they run out of cash to run the business, according to a CBInsights report. This is a warning bell for businesses with inefficient financial management. The longevity and sustainability hinge as much on the proper handling of accounts as they do on consistent revenue. 

Yet business owners make unwise financial decisions, especially during the early stages of the company. Entrepreneurs are not to be blamed for this as they face multiple challenges in achieving greater control over business expenses. Startups and small businesses lack the resources and tools to streamline their financial activities. Most solutions built by large tech organizations are designed for large enterprises, which are clunky and expensive.

Interestingly, startups are overcoming these barriers of cost and access with financial technology companies in India democratizing automation solutions. Over the last few years, India has emerged as the third-largest market for FinTech companies. Its penetration into the Indian market is evident from the range of financial management platforms that are available for small and medium-sized businesses today. 

Financial Technology Companies in India Are Changing The Status Quo

Financial technology companies in India are revolutionizing the way companies manage finances by bringing underserved entities into the mainstream fold. More importantly, they have been facilitating efficient financial management for startups. One major challenge for Indian companies has been the distributed and manual expense management approach. The reliance on paper and pen processes can lead to several mistakes and open business finances to fraud. Essentially, the manual workflows made companies blind to the financial outlook of the company.

Using the modern automation platforms by financial technology companies in India, companies are centralizing control over their business expenses. We have categorized the functionalities that these solutions provide under different sections for ease of understanding.

Automation of End-to-End Expense Management Systems

Corporate Cards Integration: FinTech solutions allow companies to integrate their corporate cards so that they can effectively manage their business expenses. The linkage allows startups to streamline T&E expenses and automate transaction report submission. It eliminates the dependency on paper receipts and tedious data entry activities.

Real-time Expense Tracking: FinTech platforms allow companies to categorize expense categories and enable employees to make claims submissions right from the mobile app. This way, startups can enjoy real-time visibility into spending and prevent invalid transactions.

Digital Receipts: Financial technology companies in India introduced innovative technologies to startups like Optical Character Recognition (OCR). It allowed employees to digitalize paper-based receipts by extracting key information from the bills and sharing it with finance teams in a seamless reporting process.

Automated Approval Workflows: FinTech platforms streamline the most critical aspect of expense management – approvals. It allows companies to configure approval workflows by defining rules, spending limits, and categories. It significantly reduced manual tasks for the finance team, while improving adherence to company policies.

Centralizing Payment Systems for Seamless Transactions

Virtual Cards: FinTech companies provide an option of virtual cards for startups to gain greater control over spending through pre-approved amounts and category restrictions. It means employees tempted to make personal transactions can be stopped from making unauthorized charges at the expense of the company.

Payment Approval Platforms: Financial technology companies in India reduce the time between invoice reception and payment by centralizing the approval system for enhanced oversight and prevention of fraudulent activity.

Data Analytics and Reporting for Greater Control

Spend Categorization: The automation solutions provided by financial technology companies in India empower companies to categorize expenses to simplify budgeting and expense analysis. It allows companies to assume tighter control of expenses across departments.

Spending Trends and Insights: With access to real-time data dashboards and reports, companies can spin up valuable insights to assess spending patterns. With this information,  finance leaders can strategize cost-saving opportunities and optimize budgeting.

Compliance Management for Reduced Risk

Policy Enforcement: Startups can integrate corporate expense policies with FinTech solutions for their consistent enforcement. Financial technology companies in India give companies the power to set spending limits and vendor restrictions for enhanced adherence to the policy.

Zaggle leading the transformation of financial management

Entrepreneurs and small business owners often rely on cash in the bank to take care of their business expenses. It not only risks cash flow stability but also takes control away from the finance leaders. In such a setup, Zaggle, one of the leading financial technology companies in India, has been creating a suite of FinTech automation solutions to help startups and SMEs streamline their financial management processes. Zaggle allows businesses to streamline end-to-end spending activities through below solutions:

• Zaggle Zoyer, spend management, and accounts payable platform
• Zaggle Save, an all-in-one employee benefits solution
• Zaggle Propel, an employee recognition and channel partner incentive platform
• Zaggle ZatiX, A credit card solution with an integrated spend analytics platform

Want to see how Zaggle can help you manage your finances, talk to our experts.