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Cards

Revolving Credit vs Line of Credit: Difference and Significance

A steady cash flow is essential for the growth of businesses or individual entities. Where tools like corporate credit cards allow the business more control over spending, revolving credit and a line of credit offer businesses more flexibility to manage their credit facilities effectively. Virtual cards are also a tool to help companies ease the process of making payments more securely.

Revolving credit and Line of credit are two potent financial instruments that allow businesses to gain financial assistance from lenders for their credit requirements. With the help of these financial instruments, companies or entities can borrow loans or credit assistance from other businesses or financial institutions to reinforce money into their own business.

Revolving Credit And Line of Credit: What’s the difference?

Finance facilities like standard credit cards, revolving credit, and line of credit help businesses grow and expand. The two financial instruments are designed to offer businesses financial aid based on borrowing requirements.

Revolving Business Line of Credit Vs Business Loan
Revolving Business Line of Credit Vs Business Loan

A conventional agreement allows the business to borrow until it closes the account with the lenders. Whereas a line of credit or non-revolving line of credit loan is a one-time agreement between the borrower and the lender, and once the loan amount is paid, the agreement gets terminated.

The criteria for issuing the line of credit depends on the business’s creditworthiness. First, the company can borrow the amount until the limit is reached and keep repaying the lender partially or entirely, depending upon the repayment agreement between the two. Then, based on the credit score, the financial institute or the lender party can decide to extend the credit limit. Additionally, the business can again borrow when the lender extends the credit limit.

Revolving Credit Meaning and Significance

revolving line of credit allows the business to borrow money from a set limit of funds from the lender. On account of the money lent, the borrower has to pay the interest amount to the lender on preset due dates. When the borrowed money is paid in part or as full payment, the funds are again available to reuse for the businesses from their revolving line of credit loan account.

This cycle of borrowing, using, and reusing the amount from the revolving Line of credit loan account continues till either party decides to terminate the agreement.

The businesses are eligible for the revolving line of credit loan based on specific criteria like credit score, business type, funding history, and business revenue. The mentioned criteria help the lender understand the business’s financial positioning to acquire a line of credit loan.

Examples

A simple example of a revolving line of credit in India is the credit card facility provided by banks to their customers. In the case of businesses, banks offer loan assistance by providing funds to a specific credit limit. The revolving line of credit loan account keeps operating until either of the parties decide to discontinue the agreement.

The bank owns the interest charges on the loan amount sanctioned. As long as the business keeps paying the interest amount, the revolving Line of credit account continues to operate. Whether the borrower decides to pay only the interest amount for a set period or repay the entire loan once, the money gets replenished into the revolving credit account for the business to reuse.

Meaning and Significance of Line of Credit India

A line of credit or non-revolving line of credit loan is a one-time agreement between the borrower(business) and the lender. Once the borrowing party pays off the loan amount, the non-revolving credit account gets terminated. Unlike a conventional agreement, the borrower has to pay the interest amount plus the loan amount on preset due dates.

Example of Line of Credit India

For startup businesses in the growth stage, funds in the business account can be drained due to increased expenses. In that case, during payments, there is a high risk of checks bouncing, which can affect the business’s creditworthiness in the long run. Thus, to avoid check bouncing, the startups can apply for a line of credit to acquire overdraft protection when the balance is insufficient in the business account to make payments.

Can a business apply for instant loans without a credit score?

The revolving credit and Line of credit loans are designed to help businesses in case of financial inadequacy. Thus, many financial institutes offer the possibility of applying for line of credit loans or instant loans without credit scores but based on specific criteria that the lenders formulate to safeguard their interest.

The lenders can agree to offer a loan amount against the corporation’s business assets that can assist as collateral. The lenders can also charge higher than standard interest rates on the loan amount sanctioned to the business.

Applying for a line of credit or instant loans without a credit score is slightly risky. However, many businesses still opt for it when analyzing the potential for their business growth. If a company can grow, it can rightfully apply for instant loans without credit scores.

To know more, visit: EnKash. You can also click below on Signup Now and we will reach out to you soon.

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Cards

Prepaid Cards – A Guide to Growth

The growth of a business depends on various factors, one of which is the way a company makes payments. With the country rapidly moving towards digitization in different industries, digital payments in India have become the crux of thriving businesses.

Modes of digital payments like corporate credit cards and prepaid cards enable companies to make payments with ease and security to increase the overall performance marketing of growing businesses with its extensive prepaid company credit card features. Virtual cards are also a part of the same category of digital payments.

What Are Prepaid Cards?

A prepaid card, also known as a stored value card, is similar to a debit card with money preloaded on the card beforehand by the card issuer. Pre-loaded cards can be either physical or virtual, depending on the issuer’s choice.

Today, many digital payment companies in India encourage growing corporates to include prepaid company credit cards in their business for the card’s exclusivity and extensive custom features. Moreover, a prepaid credit card is one of the most reliable modes of digital payments that facilitate the financial growth of a company.

Significance of Prepaid Credit Card India

Prepaid cards are not linked to any bank accounts; the issuer can connect the card to a digital wallet which sources the money transfer. For example, businesses can quickly issue a prepaid company credit card associated with a digital wallet to their employees to undertake authorized business expenses on behalf of the company.

With the help of pre-loaded cards, the company can also undertake the process of disbursements faster. In addition, it also allows the company to provide incentives to well-performing employees by offering prepaid cards as gift cards with monetary incentives loaded into the card.

A prepaid company credit card enables the business to preload the cards with a specified budget issued to the employees as employee benefit, giving the company complete control over the business funds. Furthermore, as the employees have a tight budget to adhere to, they naturally become more responsible while making spending decisions.

A company in its growth stage may have funding requirements; for that, any lender or financial institution will evaluate the potential creditworthiness of the business. In such cases, the business can use a prepaid credit card to improve credit scores. As these cards are not directly linked to the business bank account, the transaction details do not show in the accounting records of the bank statements.

Prepaid Card Digital Payment: Advantages and Disadvantages

Electronically generated prepaid cards have significantly impacted the advancement of scaling businesses. As such cards are a prominent mode of digital payments in India, companies are gradually transitioning to prepaid company credit cards as it is easy to use and cost-effective.

Listed below are some of the imminent digital payment advantages and disadvantages of using a prepaid credit card in India.

Advantages

Prepaid cards are a great alternative to standard debit or credit cards. With companies transitioning to the digitization of their entire business process, prepaid company credit cards constitute a dynamic financial tool to make payments faster and easier.

Cards like these offer the business centralized authority over the company funds, as every transaction detail gets recorded accurately with the date and payment specifications in the company’s digital accounting records.

Cards that are prepaid not linked directly to the business bank account; thus, it has no impact on the company’s credit score. However, for a growing business with multiple creditors, maintaining good creditworthiness is essential for funding requirements which is possible through prepaid credit cards to improve credit scores as the transactions do not get recorded in the bank statements.

Businesses can easily set withdrawal limits on the prepaid company credit cards to ensure optimal use of the business funds, as these cards are preloaded with a specific amount the issuer sets.

Having a set amount on the card encourages the employees to use the card responsibly and make informed spending decisions to avoid exhausting the set budget before time.

Disadvantages

Many digital payment companies in India offer prepaid card facilities to growing companies but with hidden fees like transaction fees, monthly maintenance fees or overdraft fees. Therefore, companies must choose a reliable card service like cards from the pool of digital payment companies in India.

As the transactions made through cards that are pre-loaded not recorded in any financial bureau, it does not account for boosting credit scores. As a result, the company cannot achieve better credit scores even with the most cognizant use of pre-loaded cards.

Pre-loaded company credit cards do not accrue any interest, so the amount stored in the card remains the same with or without withdrawal. This means that the amount on that particular card is as good as having physical cash in hand.

Benefits of Reloadable Prepaid Cards in India

Prepaid Cards Benefits
Prepaid Cards Benefits

Prepaid Cards Benefits

Prepaid cards are preloaded by the issuer/company with a set withdrawal limit. Therefore, prepaid company credit cards give the company complete control over the business funds as the employees cannot go overboard and spend extra cash.

Cards like these are reloadable, which allows the company to deposit money into the cards as and when required.

The company can decide whether it wants to reload the pre-loaded company credit cards monthly, quarterly, daily, or yearly based on the use of the card explicitly issued to each employee. This ensures that the company can curb the risk of financial leaks by allocating business funds rationally.

To know more, visit: EnKash. You can also click below on Signup Now and we will reach out to you soon.

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Expenses

How Does Expense Management Software Help Your Business?

Whether you are an individual or a company, expenses are a part of life that you cannot avoid. While expenses are inevitable, there are chances that the repercussions of not managing expenses well could be more profound and long-lasting on businesses because of the sheer volume and the impact it creates. What you require is a smart business expense management software.

Let’s start by looking at the definition of some terms, define why we need to manage expenses, and how expense management solutions help. Then as a next step, we will look closer at the reasons that small and medium-sized enterprises should consider investing in expense management solutions.

What is the meaning of expenses?

An expense has been defined as a cost incurred. Expenses come in different forms. They can be a one-time expense or recurring. Expenses can range from manufacturing, operating, financial, prepaid, and extraordinary, to accrued expenses. You also have emergency expenses that you cannot anticipate but make a provision based on past data.

In accounting terms, expenses have been divided into four categories—fixed, recurring, non-recurring, and emergency.

What does expense management mean?

According to Wikipedia, expense management is the method by which a business processes, pays, and audits all expenses. This could include employee-related expenses, travel & entertainment, and other expenses. Expense management also involves planning for expenses, ensuring that the right checks are in place to ensure they are legitimate, approving processes, and making the payment or reimbursing the expense to the one who made the payment.

What is an expense management system?

On a small scale, expense management can be managed (barely) with the help of a few basic tools like a spreadsheet, calculator, ledger, vouchers, and even handwritten notes. However, expense management automation becomes crucial when it comes to managing the expenses of a business. Managing expenses is vital not only for the business to run but also to ensure that it meets audit and compliance requirements.

An expense management system is software that enables you to record, track and make expense payments with ease. Not only that, paperless expense management or expense management automation, ensures that the process is automated and requires minimal manual intervention. No matter the size of your business, you need expense management software to ensure smooth operations. Today we even have expense management software for small business that is effective and affordable.

5 benefits of expense management software

Many small and medium-sized businesses often feel that investing in expense management software is a good-to-have factor but not a must-have. And it is also true that SMBs are the ones that are most affected by the lack of expense management. Businesses see a serious blip in their operations when faced with random expenses for which they have to locate sources of finance.

Benefits of Expense Management Software
5 Benefits of Expense Management Software

Helps bring down the cost of finance

Cost of financing sudden expenses can seem trivial to begin with but over time the cost of finance can add up substantially. Not only that but also the cost of finance would also include late payment penalties that you would incur due to late payments.

It would also include the loss of bargaining power due to delayed payments. Often suppliers and vendors give preferential treatment to those customers who pay on time for both rates as well as the quality of supplies or services.

Ensures better cash flow management

Cash flow management or managing working capital to run the business is a task that finance managers both fear and are loathe to ignore. When expense management takes a hit, it is most likely that cash flow takes a hit too.

Any unplanned expenses or rogue spending is likely to put your budget off balance and this, in turn, can cause your working capital to be affected. With expense management automation, you can look at empirical evidence to plan funds for those times when your expenses are at a peak.

Raises an alert where expenses are out of control

Expense management software ensures that not only are you avoiding repetitive manual processes but also getting an overview of the expense management trends within your company. Keeping tabs on expenses will ensure that they do not get out of control. In fact, you will even discover that some expenses can be avoided like a service that you only use yearly but are paying a monthly subscription. Often something as simple as changing the subscription plan can make a huge difference.

Reduces manual efforts of all concerned

Automation of finance functions like expense management will reduce your paperwork and the manual efforts that your teams put into it. Imagine, if your solution offered the means to scan or take a picture of a bill and automatically upload it onto the system.

The whole process of checking, approving, and reimbursing the business expense would involve a few clicks instead of the lengthy manual process. Typically, a manual process would involve waiting for the receipts to be sent to you, fetching them, checking them, making entries, sending them for approval, filing the paperwork, and making the payment. And any deviations would add additional steps to the process and further increase the manual efforts involved.

Better auditory and compliance management

Monthly, quarterly, and yearly closing of books are something that is essential for the finance department. Doing this not only ensures that they are keeping track of various financial aspects but also helps with audits and compliance. Preparing for audits can take a lot of time and effort due to the sheer volume of records and supporting documents that have to be produced.

However, with the automation of expense management, the records are digitized which automatically cuts down the efforts. But that’s not all, you also have hierarchies, approvals, and records of all exceptions that took place in expense management. A trail of all the approvals and justifications needs to be produced during the auditing process. With automation, all these records are available at the click of a button. The same goes for compliance; records are created automatically in real-time and any exceptions are recorded which makes the entire process easier.

Why is Expense Management Automation critical for SMBs?

Even as we acknowledge that automating functions like expense management is essential, it is also important to see why it is even more so in the case of SMBs.

Limited resources: Whether it is in terms of money, people hours or time, resources are a constant issue with SMBs and investing in affordable expense management is the best way forward. Expense management automation ensures that there are savings on the number of hours spent, easier closing of accounts, and better fund management.

One person with multiple roles: In smaller companies, there’s a chance that a single person is carrying out multiple roles and while this is a good thing, it can result in missing details. An end-to-end spend management platform will ensure that the burden of managing multiple responsibilities becomes easier.

Need for better insights: Planning, forecasting, and budgeting are key to consistent financial success of any business. And when we consider smaller businesses who have access to limited customers, this could make the difference between continued operations and closure. An expense management software will not only automate many of the mundane tasks, but also ensure you have the insights to plan better. Insights into expenses also enable you to put controls in place to make sure there is no rogue spending.

Documentation for finance: Getting a line of credit or other finance facilities for SMBs is not easy. It becomes even more difficult if the company in question does not document their finances well. An expense management will ensure that records are created in real-time with minimal errors, if any. This can not only ease the audit and month closing but also ensure that you get the funding you require.

Conclusion and the way forward

Expense management software in today’s world is no longer optional but a factor that can decide the success or failure of your business. At EnKash, our team talks to numerous first-generation entrepreneurs and our endeavor is always to offer solutions that suit their needs and their budgets.

Our exceptional portfolio of spend management and cards platform covers the whole range of support that a SMB or startup may require. And our corporate credit cards not only offer a line of credit but come with the means to issue child cards to your employees or teams to ease the spending process.

Our DIY dashboard ensures that you have complete control of the cards in terms of how much is spent, what it is spent on, and the amounts spent. It also ensures accountability and security with the feature that enables you to disable or cancel a card in case of theft or employee separation. With the option to create hierarchies and approval workflows as per your requirement, our solutions cover all your needs.

To know more, visit: www.enkash.com. You can also click below on Signup Now and we will reach out to you soon.

Categories
Cards

Corporate Credit Card Policy: An Essential Guide

A corporate credit card is an incredible financial instrument for businesses to carry out financial tasks with ease. It offers the business complete and centralized control over the company funds, which ultimately allows them to take strategic business decisions regarding necessary expenses.

Corporate Card: Meaning and Advantages

A corporate credit card is a financial tool similar to a standard credit card but is used essentially for corporate needs. The company issues these cards to a selective group of employees to carry out important financial expenditures on behalf of the corporate firm. To further simplify corporate card meaning and its extensive usage for growing business, listed below are some of the most prominent advantages which make it the ultimate financial instrument for businesses.

  • A corporate credit card allows the business to manage, control and streamline all the company funds under one domain
  • A business can track its financial expenditure and formulate strategic plans to curb unnecessary spending with corporate credit cards, India
  • The company can even set limits on the card to avoid incidents of overspending
  • Also, with the help of corporate credit cards, companies can now have a bird’s eye view of their business finances; this allows them to track any potential financial leaks
  • Additionally, a corporate credit card in India improves the employee’s efficiency and productivity exponentially, as they do not have to go through the complicated procedure of reimbursements

A corporate card opens a multitude of excellent business growth opportunities, but only if the company has a stringent and reliable corporate card policy in place. In addition, a corporate credit card policy and procedure allows the company to set proper regulations for the employees to adhere to and benchmarks for other corporates who want to do business with them.

Also, corporate credit card is easy to use and functions exactly like a standard credit card. But compared to regular credit cards, a corporate card is more secure and convenient to use. Additionally, it allows the company to set limits on the withdrawal amount irrespective of the available balance amount on the card. However, firstly, a corporate credit card must be loaded with funds by the company to make transactions possible. As a next step, employees must be informed about the corporate credit card policy that highlights the usage rights to avoid accidental or deliberate malpractices.

What is Corporate Credit Card Policy?

A corporate credit card policy is all the listed regulations that employees must abide by as these are complaisant rules for responsible and fair usage of the corporate card. The policy holds the power of accountability, responsibility and usage rights applicable to the cards issued by the company to the employees to make authorized business expenses.

The company formulates the corporate credit card policy and procedures to protect itself in case of any unauthorized or unfair use of the card. In addition, the card protects the employees in case of phishing, as a corporate credit card is a highly secured financial instrument.

Importance of Corporate Credit Card Policy and Procedures

Having strict corporate credit card policy guidelines enables the business to avoid the risk of misuse by employees. The guidelines are binding to the employees and ensure fair and authorized usage.

The purpose of the corporate credit card is defined in the policy to help the employees understand their contractual agreement for making payments on behalf of the company. The company expense process and policy educates the employees on their role and responsibility with regard to the corporate card issued to them.

The business credit card policy guidelines clearly define who is eligible to use the card and under what circumstances to restrict employees from sharing the cards with other employees who are not entitled to use them.

Furthermore, the company also gets complete control over the spending limits on every corporate credit card, which complies with the policies and guidelines to avoid deliberate or accidental overspending by employees.

A company-provided credit card policy document is available to the employees to ensure they completely conform to the policies stated to avoid causing any unintentional accounting lapses.

Corporate Credit Card Policy Best Practices

For companies that deal with multiple vendors, issuing a corporate credit card to their employees simplifies the accounting procedure just like credit policy makes lending easier. It also reduces the efforts required to apply and approve funds between the management and the employees for the use of business expenses.

But issuing corporate cards to various employees can also lead to problems like accidental or unauthorized spending by the employees. That is why the company needs to set firm corporate credit card guidelines before handing out the cards to ensure fair use of the corporate card.

Corporate credit card policy best practices
Corporate Credit Card Policy Best Practices

Below are some of the foundational corporate credit card best practices to ensure the employees understand and comply with them.

  • Stating clear and concise responsibilities that come with holding a corporate credit card. The employees should know the repercussions of misuse and the benefits of proper usage of the corporate cards beforehand
  • Corporate credit card spending limits should be informed to the employees to ensure they take strategic financial decisions on whether or not the expense is a top priority at the moment
  • Authorized expenses should be listed in the policy clearly to make sure the employees avoid instances of personal spending using the corporate credit card in India
  • Additionally, the business credit card policy guidelines should mention steps to take in case the card gets stolen or lost

To know more, visit EnKash. You can click on Book A Demo and fill in the details required; we will reach out to you.

 

Categories
Cards

5 Reasons You Need Prepaid Credit Cards For Your Business

Many businesses that operate on a small and medium level have gained huge success and have been able to scale their company profitably with prepaid credit cards, as they are regarded as a powerful financial tool to manage business expenses. Moreover, in the wake of digitization, it has become even more critical for organizations to adopt prepaid cards to ease the process of managing company accounts payable.

Significance of prepaid credit cards in India

Prepaid credit cards are an essential financial instrument that every business needs to grow in India. Corporate prepaid credit cards allow your business to allocate its working capital resourcefully and avoid the risk of financial fraud.

Having a limit set on the prepaid credit card enforces a sense of responsibility in the employees’ minds as they must adhere to the available balance on the card. This way, the company can control where the business funds are getting used and whether or not it is a priority to make that expense.

Corporate prepaid card solutions: the most efficient way to accelerate business growth

When a business is in a growth stage, it is common to have multiple employees work in one department, like the finance department having more than one employee managing the company finances. And even though issuing corporate cards to multiple employees makes the business process efficient, it raises the risk of misuse of the business funds. That is why it is crucial for corporations issuing multiple corporate cards to shift to prepaid credit cards to have more control over their working capital.

Let’s look at some of the most prominent reasons why corporate prepaid card solutions are the most efficient way to accelerate business growth.

Financial Control: With prepaid credit cards, businesses can set spending limits on the cards issued to employees. This way, the company can have complete financial control over the working capital. Furthermore, corporate prepaid card solutions ensure timely payments for organizations dealing with multiple vendors and creditors. In addition, businesses can easily set recurring payment options, which automates the payment process and reduces employees’ workload.

Streamline Accounting Process: With EnKash prepaid credit cards , companies can view where the business funds are being used. The corporate prepaid credit card enables them to track every transaction with utmost accuracy. In addition, the EnKash spend management feature allows the company to view all the vendor databases, including the invoicing details, in one place.

Ease of Invoicing: If a business trades with many suppliers, managing invoices becomes challenging as the company needs to maintain the receipts, fill in the details in the accounting records and then make timely payments. The entire process is tiring and runs the risk of errors in the accounting books, as it is humanly impossible for employees to record massive data with 100% accuracy. With EnKash corporate prepaid card solutions, businesses can automate their digital payment process, like invoicing, recording, managing, and sending payments.

Allocating financial resources: For growing businesses, it is essential to strategically allocate financial resources to avoid losing business funds. Companies in the growth stage aim at diversifying and delegating, which might lead to the draining of working capital if the employees handling the business finances do not use the financial resources appropriately. That is why it becomes even more critical for growing businesses to issue prepaid credit cards encouraging the employees to take informed and strategic purchase decisions.

Reloadable: A prepaid credit card not only reduces the risk of overspending but is also a great alternative financial instrument for companies as these cards are easily reloadable. Companies function for an extended period, and thus it is expected that they will incur substantial business expenses every month. With corporate prepaid credit cards, the company can quickly reload the cards monthly with a budget.

What to know about prepaid cards
What to know about Prepaid Cards

How do reloadable prepaid cards work?

  • Reloadable prepaid credit cards are relatively simple to use. Businesses can claim the card and easily activate it with just a few simple steps. Once the card is activated, the company can load the card with funds by direct cash, bank transfer, online payment, or by linking the company bank account
  • With reloadable prepaid cards, the company can either opt to transfer funds into the cards weekly, monthly or even daily based on the needs or the frequency of the card’s usage
  • In addition to setting the budget on the cards, the corporate prepaid cards solutions enable the business to set a limit on the amount that can be used daily to further reduce instances of reckless spending

Digital payments through payment gateway are the best way to make business transactions, as they are convenient, easy to process and track, and, most importantly, they enable the business to control spending limits. Additionally, for growing startups and enterprises, issuing prepaid credit cards to employees enables the business to streamline the company’s business funds and provides it with centralized authority over the business cash flow.

To know more, visit EnKash. You can also click below on Signup Now and we will reach out to you soon.

 

Categories
Payables

What Is E-payment and Why Is It Critical for Today’s Businesses?

In a world where online is no longer a good to have but a must-have option, e-payments rule the roost. Today, you will rarely see people, especially the younger generation carrying a lot of cash. In fact, many businesses stand to lose their market share if they are not in a position to offer the option of e-payments.

Cheques, demand drafts, pay orders, and other such payment instruments seem to have lost their usefulness in today’s world. The younger generation may not even know such an option exists.

E-payments or electronic payments are nothing but payments that are made through electronic or online means. Some of the well-known online payment modes include credit, debit, and virtual cards, internet banking, e-wallets, direct debit, standing instructions, UPI payments, etc.

The way the world functions today, most of us know the different modes of e-payment or online payment modes. As a growing business in today’s world or as a consumer, you would have definitely enjoyed the benefits of electronic payments. The speed and convenience of such e-payment methods cannot be overlooked. However, did you know the benefits go beyond mere speed and convenience? At EnKash, we offer a variety of financial solutions to help growing businesses cope with their financial needs, which include the means to make, track, receive, and manage e-payments.

Let’s take a closer look at the advantages of the electronic payment system

Benefits of E-Payment

5 Benefits of E-Payment

Faster collections

Yes, we are talking about collections here rather than payments. How do e-payment options ensure quicker and more efficient collections? It’s simple. When you embed an online payment link onto the bill or invoice, it spurs the receiver to take action. In most cases, the delay in payment is because the customer or buyer has to switch from one device to another and in most cases go through a long process to make the payment. With the e-payment option, most of the actions take very little time including entering the OTP to make the payment.

Safe and secure

Imagine you had to make a huge payment to your utility provider or your supplier. If you had to carry the cash to make payments, it would make you vulnerable to losing it or getting robbed. Or if you had to write a check, get it signed or sign it yourself, it would take time. What is more, wrong date or amount mismatch or signature mismatch in the payment failing. But with online payments, not only do you have security in the virtual sense but also in the physical and timeline sense.

Action-oriented

With the more conventional methods of payment, the chance of not paying on time or missing out on-time rebates becomes a possibility due to the longer process. It is a daunting process to get a physical payment instrument or cash ready but electronic payments are not like that. You have the option to check for the availability of funds, click on a link to authorize the payment, or get the authorization and proceed to make the payment without moving from the place you are working from. Online payments are more action-oriented, spur you on to the next steps, and help you close the loop.

Fully trackable

When you make cash payments or use drafts to make the payment, it becomes a longer process to track the expense. You either need a bank entry to be updated when the check is encashed or get a receipt for the cash payment. Among the many benefits of electronic payments, easy-to-track would be on the top. The request for payment, the checking and authorization, the approval to pay, the payment received, and the reflection of the amount deducted from your account, takes place automatically.

Customer-centric

While the availability of options for electronic payment offers you many benefits, one of the leading benefits is making you more customer oriented. Imagine that you had a business where you deal with many stakeholders like vendors, suppliers, customers, shareholders, employees, etc. but did not have provisions to receive or make e-payments. The sheer amount of paperwork would make it difficult for you to meet the requirements of external and internal customers.

E-payments are here to stay. Here’s what you need to do next

As a business owner in today’s competitive environment, you need to make sure that you reinforce the e-payment or online payment system that you have. You could consider a complete spend management platform like the one that EnKash offers. Our platform offers an AI-powered dashboard to help you keep track of expenses. Additionally, we also offer corporate credit cards, purpose-built cards, prepaid cards, and an easy credit line of up to INR 1 cr. Talk to customer support to learn more.

To know more, visit EnKash. You can also click below on Signup Now and we will reach out to you soon.

Categories
Cards

Working Capital Loans To Fuel Your Start-up

An entrepreneurial wave has engulfed the day. At present, the number of new (recognized) startups is well over 14,000, a terrific rise from 733 (in 2016-17)—one major factor being the rise of fintech players in recent years. Thanks to them, all businesses, especially those that start from scratch, can now fuel their startups with easy money or “working capital loans”, often with no collateral.

The fundamentals of business are quite simple & universal:

Money makes money: Startups earn more when they invest more. However, money is a complex entity, often because our markets are plagued with fatal myths, like this one:

Loans are BAD; because Loan= cash crunch= business failure. They tell you that you are already a failing enterprise if you are considering a loan.

However, we’d beg to differ. We say a smart working capital loan can build a roadmap to IPO listings! (You’ll agree as you read along)

What is Working Capital Loan?

We often dread a loan for its never-ending cycle of EMIs. But unlike a home loan or a car loan, a “working capital loan” is much easier to avail and vital for a business

Working capital is a continuous want; one needs a consistent cash flow to pay the people who work for you (“payroll”), to pay the “rent” for the land used, for the machineries, and to restock components/ finished products for future needs (“inventory”).

Company revenue may fluctuate monthly, seasonally or quarterly, but cash needs don’t. In short, working capital is the money that keeps your startup going on a day-to-day basis. And a working capital loan makes sure you always have enough working capital in hand.

Types of Working Capital Loan available for SMEs & Entrepreneurs:

Working capital loans are basically two types: Secured loans (collateral required) and Unsecured loans (without collateral).

Some popular working capital loans are:

  • Bank Overdraft/ Line of credit: This loan is gained through a pre-approved withdrawal limit on your current bank account.
  • Merchant cash advance/Factoring: This is the loan availed against future credit transactions instead of the current sales receipt; here, the fees can be high, and it might affect your future credit score too.
  • Short-term loans/Installment loans: a secured loan type, this is one of the better-known working capital finance options used by Indian SMEs. It is the money lent against a fixed interest rate for one year or less.
  • Business Credit cards: Corporate cards like the Credit Card are unlike traditional loans, are used to finance unforeseen capital needs and can be your all-in-one virtual card for all business transactions.
  • Equity Funding: Many early startups use personal resources or investors (family and friends) against the startup’s part (equity share).
  • Trade creditor: This is the loan availed on placing bulk orders. Usually, suppliers lend such loans to SMEs.
Types of business loans
Types of business loans

Why & When do you need working capital finance?

Consider the following scenario: Prasad, a 32-year-old farmer, decides to start an agritech startup.

He has the expertise, the technology and the human people. He decides to bet on his idea by selling some of his assets and is making decent revenue. People like his products, but product sale is limited.

There is also a backlog of non-payments from clients, which will take time to recover. In technical terms, his company’s liquidity (or cash in hand) is diminishing without affecting its market value.

His key concerns are:

  • How does he pay his people for the following month?
  • Should he make further purchases to stock up his inventory?
  • Should he invest in marketing?
  • Has he failed as an entrepreneur?

If you are living this dilemma, don’t fret! You are not alone. In India, millions of startup founders & merchants, from the smallest Kirana store to the largest supply chain owners, face this problem (or a part of it).

Many would agree that Prasad can perform much better if he gets monetary aid. And that is exactly where top fintech companies in India 2020, like the EnKash, enter the scene.

A Capital finance will help startups with the following:

  • Fulfilling cash needs for rent, payroll, inventory, and other daily operations is vital for sustenance.
  • Improve the company’s growth curve with marketing and achieve increased retail sales.
  • Improve the company’s liquidity status until recovery from unpaid invoices.
  • Invest more in future plans of expansion

Check your eligibility before approaching for a loan!

The most important criterion for eligibility is a good credit score. However, it is highly dependent on your annual profit & revenue, your outstanding debt and length of credit history, among other variables.

A good credit score for startup loans is 700. You can get easy loan approvals, even with a low credit score on platforms like EnKash.

EnKash also offers virtual EnKash credit cards for smart corporate payments and advanced control over your finances right at your fingertip! To know more, check out the link below:

5 Quick Ways To Get Financial Help From Lenders In India

Financial aid, in the face of an emergency, can be quickly availed through:

  • Lending from friends and relatives for quick cash.
  • Applying for quick, collateral-free loans on fintech platforms like EnKash (where the loans can be approved within 3 business days and zero collateral, all through a DIY interface).
  • Mortgaging of land/ property and eligible assets against withdrawn amount.
  • Applying under Pradhan Mantri Rozgar Yojana (PMRY) and other eligible government schemes (under PMRY, eligible candidates can avail up to 5 lakh of loan for business setup).
  • Availing gold loans against mortgaged jewelry and valuables.

EnKash can help you fuel your business with instant approval credits

At EnKash, we strive to assist all our entrepreneurs and wonderful risk-takers to easily get past any financial roadblocks.

Revolutionizing startups with easy money, EnKash offers:

  • Quick collateral-free loans in the least downtime- to help fuel your startup dreams
  • A completely digital interface to create a hassle-free loan approval space.
  • A 100% digital KYC for availing corporate cards like the all-purpose EnKash Credit Card.
  • Minimal documents required to process your loan, with zero foreclosure charges.
  • Once onboard, you can save much more with a DIY spend management system by tracking your expenses and transactions in real-time.
  • Apply in less than a minute and redeem your rewards now.

To know more, visit EnKash. You can also click below on Signup Now and we will reach out to you soon.

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Cards

7 Benefits of Payroll cards for Employees

Caring for employees makes a business seem thoughtful and reliable. Employee satisfaction is a two-way street and payroll cards for employees is a good start. The easiest way to make employees happy is to pay them on time. If they get the regular payment on time, they will kick off the financial stress. Moreover, if they get a salary in no time, it will be added advantage for you, and this is possible through Payroll Card.

Some of the companies in the present day are releasing the salaries in the form of cheques, direct transfers into their bank accounts, or in some rare cases, in cash. While these are the prevalent modes of salary deposits, payroll cards are quickly turning heads in being the easiest and fastest way to credit employee salaries.

Payroll Card- At A Glance

A payroll card is a debit card issued by the employer to each employee. Salaries are directly added to their payroll cards, thus giving them instant access to their pay. There are numerous advantages of using payroll cards to credit employee salaries. Both the employer and the employees can benefit immensely from adopting payroll cards in their portfolios.

Benefits Of Payroll Credit Card For Employees

Instant Access to Salary

When salaries are credited using traditional modes of payments like cheques, it takes days for the money to reflect in the employee bank account. All this time, funds are blocked, and the needy one cannot use them. While the bank transfer is fast and convenient, it carries with it a certain amount of risk. Payroll cards are the fastest way to gain access to pay.

No Bank Account

The beauty of payroll cards is that you do not need a bank account for them! India has around 190 million adults who still don’t have bank accounts. And even if you have one, there is always the hassle of maintaining a minimum balance, paying annual maintenance fees, and transaction charges on basic services. A payroll credit card omits all these issues.

Ease of Use

Your employees can use the payroll card as a simple debit card. It can be used to withdraw money at an ATM, pay for shopping at any merchant’s outlets, and even for online shopping. With this card, they can avoid carrying a huge wad of cash and just pay with your payroll debit card.

Rewards

Payroll cards, especially the ones issued by EnKash, offer huge rewards on every transaction. So, by using an Enkash payroll card to pay, you are also earning back perks at the same time.

Increased Reliability

Paper cheques are the least reliable way to credit employee salaries. They can be lost, torn, or damaged. They can also bounce if the employee’s name or any other information mentioned on it does not match the bank records. These hassles are eliminated by a payroll credit card or debit card. You can be sure that your employee receives their salary instantly.

Time and Cost-Efficient

Paying salaries traditionally requires a lot of time and focus. One misspelling, and you gotta start all over again. Not to mention the numerous approvals to be taken and cheques to be signed. Payroll credit cards or debit cards save a lot of time and effort. Simply transfer salaries at a touch of a button to a specific payroll card, and voila!

Paperless

Going green is the next agenda of all sustainable businesses. A payroll card helps you build your sustainability quotient by eliminating most of the paperwork. No need for cheques, manual data entries, envelopes, etc.

EnKash is your financial boss! Don’t believe me? See the glimpse of how it manages everything!

Wrapping Up

Payroll cards are going to change the face of the payroll industry. With their ease of usage, increased employee wellness, and paperless approach, they are a beacon of hope for a switch in the traditional methods of payroll.

EnKash also offers a powerful spend management platform that can also allow employers to keep a track of all payroll cards from a single dashboard. You can monitor which payroll cards are loaded with salaries, that are not in use anymore, are nearing expiry and need to be re-issued, or need to be discontinued. Make your employees happy by enrolling for EnKash Payroll cards now!

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Cards

Tax-free Meals For Your Employees With EnKash Meal Cards

Employee satisfaction is one of the cornerstones of a successful business. To keep your employees happy, just paying salaries on time is not enough anymore.

Many businesses are introducing trending perks for the employee, including meal cards for employees. This service is quite popular in the corporate sector and also gives effective output in productivity. Here, you will get to know everything about meal cards and their benefits.

Why is there a need for Meal Cards for Employees?

Businesses now have to look into providing incentives, gift cards, employee rewards & recognition schemes, mental health upliftment practices, and whatnots of the woke world. While these seem to be the norm already, companies are now pushing the envelope by offering tax-saving facilities for employees to avail when they make business-related expenses.

Employees are always on the lookout to increase their in-hand salary. By offering them services that help them reduce their tax, it’s a win-win situation for both the business and its employees.

One of the ways this could be achieved is by disbursing tax-free meal amounts to your employees. According to Indian federal law, the income tax bracket ranges from 5% to 30%. Under the Income Tax Act Section 17(2)(viii), food allowance can be provided to your employees which is completely tax-free.

Under this act, you can offer a food allowance of Rs 50 per meal during working hours. If you decide to provide 2 meals during the day, it comes up to Rs 100 per day. If you have weekends off policy, your employees work approximately 22 days a month.

As per the above work duration, the food allowance racks up to Rs 2200 per month, which is Rs 26,400 per annum. This means that your employees can save tax on Rs 26,400 annually if you provide them with a food allowance. This is definitely not a small amount, and your employees will be grateful to you for being so thoughtful towards their savings via meal cards for employees initiative. It will also instill goodwill and faith in them towards your company which in turn helps in forging long-lasting employee bonds.

Are you wondering how the employees will handle the meal card?

Now the question remains how to disburse the amount to each employee? How to keep track of the meal amounts being used? How to ensure that the food allowance is used for the food itself? These burning questions are answered easily by EnKash– a smart corporate card and expense management platform that can sort out all the issues.

EnKash offers a gamut of corporate expense cards- both credit and preloaded cards, including gift card. EnKash meal cards are easy to use, convenient, and versatile. They can be used at all food and beverage merchant outlets, including restaurants, sweet shops, etc.

5 Benefits of Using EnKash Meal Cards

Use As Physical Or Virtual Card

Employees can use this card either physically at an outlet or a digital outlet for online food delivery or online payment. Meal cards for employees can either be issued physically as a plastic card or digitally as a virtual card.

Flexible To Recharge

You can either preload the meal card with the monthly meal allowance amount or you can top up the meal card daily with the daily food allowance amount, as per your convenience.

Easy Expense Tracking

EnKash meal cards also come with an option to get onboard their smart and intuitive card management platform that can allow you to keep a track of all expenses on all cards from a single dashboard.

No Expense Boundaries

The Meal Cards for employees are PCI-DSS Certified and RBI Compliant, so there is no hassle of federal compliance. The platform helps you in maintaining a real-time check on all spending while it happens on the meal cards. So, you can rest assured that the expense is well within the authorized limits and merchants.

Access From Around The World

You can also remotely block the card if it seems like it has fallen into wrong hands. The preloaded nature of these cards helps in safeguarding against fraud as the expenditure cannot go over the amount present on the card.

These cards can be issued directly from the cards platform and can be activated instantly through e-KYC. One of the major benefits that the finance team enjoys with meal cards is the paperless process of disbursal and reporting.

With a remote-friendly platform, finance managers can monitor the cards from anywhere and take action with a single touch of a button. Audits are easier because of flawless digital bookkeeping and maintenance of expense records on a digital database that is secure and backed up on the cloud.

Enjoy this host of benefits and enhance your business by applying meals cards for employees scheme on your firm. Boost spirits and sales without worrying about additional overheads. EnKash is here to back you up in your journey to make your business smarter. Join our family today!

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Cards

Corporate Prepaid Cards Vs Corporate Credit Cards

Businesses- big or small, still heavily rely on corporate credit cards for their finances. It’s a practice that’s been adopted for years and while it does give a certain degree of freedom to conduct business transactions, there are still many roadblocks that lead to its inefficient usage. In this blog, we will learn more about prepaid cards vs corporate cards and which is more optimal for usage.

A Glimpse of Prepaid Cards

Prepaid cards come as a virtual credit card that is already loaded with a specific amount so the employee cannot spend a rupee above the pre-loaded amount. These cards look just like a regular credit card and can be used the same way- online and offline.

When you evaluate prepaid cards vs corporate cards, you realize in prepaid cards, there are no credit cycles or revolving credit associated with it. You pay with what you have. Prepaid cards are not linked to the company’s bank account which makes them less prone to expense fraud. But in Corporate Cards, there is not set of limits and the expenses are charged from the company’s account.

Being a business owner, you can easily hand them out to trusted employees to give them independence over financial decisions. Prepaid cards work in a simple yet effective manner. It comes with a preset monthly budget and spends limit. If an employee wants to make a purchase from his prepaid card, he will first need approval from his manager. Once his expense is authorized, access is granted to him.

Exclusive Features of Prepaid Cards

In Prepaid Cards, if the purchase is within the monthly budget and single purchase limit, the purchase is validated and successfully done. If not, the purchase stands cancelled and the employee needs to ask for access to funds again that sticks to the budget. Many Fintech Credit card companies formulate the prepaid cards and design the algorithm as per the benefit of the firm.

Employees in the higher management can gain access to a higher amount of funds and so on, hierarchical classification of approvals and spending limits can be set in place easily.

Prepaid cards also come in a virtual avatar. These cards can only be used for online transactions. It is a one-time card that is created by the finance manager for a specific end-use.

Virtual cards are extremely secure because everything from their spending limit to the merchants at which they can be used can be customized and preset. This saves precious time wasted in approvals. virtual credit cards in India enabled many businesses to manage the cash effectively.

Optimizing workflow and enabling smarter payments is what virtual cards do best. And not just one-time payments, virtual cards can also be used to take care of all your recurring expenses like rent, subscriptions, retainer fees, and so on.

Being an Indian, you can create a recurring virtual card India for all your expenses and the amount is just prepaid on the card right before the payment is due. Putting your repeated expenses on autopilot has never been easier!

Domination of Prepaid Cards over Corporate Credit Cards

As an entrepreneur, if you are in a dilemma of prepaid cards vs corporate cards, then it is time to learn about corporate credit cards. Then here, you will get the answer. A corporate credit card is just like an ordinary credit card where the employees get the authenticity to do the expenses for official purpose and the amount is deducted from the business account.

Corporate Credit Card India gives a major support to the businesses but it has some setbacks, because the limit is not set and the unexpected expenses done by the employees through the corporate cards can be a severe threat for a business.

Prepaid cards are slowly taking over the corporate credit cards share in the industry. Corporate credit cards, no matter how handy, have their own set of issues that can be addressed easily by prepaid cards. For instance, one of the biggest pain points financial teams faces at the end of every quarter is the reconciliation of expenses against the credit card statement.

Employees need to save receipts of each expense borne on the company credit card and submit them to the finance team for verification. And that is just one employee with one card! Imagine the plight of the finance team at the end of every monthly or quarterly closing, sitting with a pile of receipts along with a host of expenses on multiple credit cards. The scene is nothing short of a nightmare.

The above process comprises of manual reconciliation and paperwork that can be easily avoided by opting for prepaid cards. Clubbed with a smart platform to track and monitor these cards, Prepaid cards in the form of virtual cards can most easily be the answer to all the problems.

With built-in approvals and preset budgets, prepaid cards- virtual or physical, are on the fast track to becoming the next best digital lending platform.

While corporate credit cards India do have the allure of revolving credit, the end goal is to have a steady cash flow rotation so that there is substantial working capital available at all times for your business.

The goal is met by prepaid cards too because when budgets are adhered to, expenses are tracked, and reconciliation is done in real-time, cash flow is maintained.

Give in to the charm of prepaid cards and make your employees happy and your finance team relaxed. Some of the best practices to follow when choosing a prepaid card for your business is:

Key Elements to note while choosing Prepaid Cards

Virtual cards

Unique card details for each expense are a boon for one-time and recurring expenses that could be set on autopilot without worrying about the card details being stolen and the business account being hacked into.

Virtual Credit Card India is high in demand because of its features and transparency. Moreover, virtual credit card is highly secure and also retains the details of every transaction.

What benefits can you get with EnKash – The virtual credit card in India?

Flexibility

Creating different spending limits for each card according to the employee hierarchy makes expense management easier

Automated approvals

Built-in approvals for expenses can save a majority of time in going to and for a single purchase.

Easy integration

A virtual credit card is a utility that integrates easily with your existing accounting software so that you don’t have to make manual data entries

Remote corporate access

Expenses can be monitored, tracked, approved, and flagged from anywhere at any time.

EnKash is a powerful corporate card and spends management platform that can instantly change the way you handle business expenses. Be it credit, prepaid or virtual, EnKash has a portfolio of all kinds of corporate cards. Make your business expenses smarter with EnKash today!