Nearly 50 percent Indian MSMEs waste time on repetitive operations through age-old banking systems

July 21, 2022, Jaipur: MSMEs have been one of the strongest drivers of growth and employment in the Indian economy. However they lose a significant amount of time and money in paperwork, manual operations, and customer support at traditional banks. A recent quantitative study on product preferences by Tide among 500 small business owners across the country revealed that 50 percent of enterprises are wasting business hours on petty administrative tasks, such as depositing cash in the bank.

The tribulations in managing time can also be attributed to the lack of dedicated finance teams and technological understanding around new-age banking solutions. The survey, which was conducted by Tide to find the challenges and needs of MSMEs in India, found that 62 percent MSMEs do not have a dedicated finance team.

In Rajasthan, which is home to nearly 26.87 lakh MSMEs, 46 percent of business owners cited hidden charges and tracking transactions as key challenges with their existing banks. Interestingly 31 percent enterprises expressed the need for personalized services from their business banking partner.

In line with this, Tide, the UK’s leading SME-focused business financial platform that began setting up operations in India in 2020 has partnered with Transcorp International Limited, a 27-year-old Reserve Bank of India (RBI) regulated Authorised Dealer Category II and perpetual Prepaid Payment Instrument (PPI) license holder, to launch co-branded prepaid cards (Tide Expense Card) as an entry product. This roll-out stems from Tide’s vision to help SMEs in India save time and money and offer a mix of services to meet the diverse needs of small businesses.

Tide will offer payment services to small businesses across India, starting with a Tide Business Account, accompanied by a Tide Expense Card powered by RuPay.

The partnership leverages the expertise of RuPay, India’s indigenous payment network, the long-standing reputation of Transcorp, and Tide’s vast experience with SMEs in the UK, to help small businesses in India save time and money. Tide also plans to launch other payment and business services for India, later this year.

Kumar Shekhar, VP, Tide (India), said, “We, at Tide, wish to support entrepreneurs in their journey and believe we’re in a strong position to do exactly that. As we scale-up in India, we will expand our product offerings for small businesses who wish to take the big step of starting out in business – whether it’s as a contractor, freelancer, sole trader, or small business owner. Transcorp is a great partner for Tide, with a great reputation as an issuer for co-branded prepaid instruments. Transcorp has already demonstrated success with its partners and Tide is delighted to join this illustrious list.”

Users will be able to activate and manage their Tide Business Account and Tide Expense Card through the Tide app, which will also be used to load money, collect payments and check spends, amongst other services.

“Transcorp is delighted to partner with Tide to enable digital payments and promote financial literacy amongst India’s largest business fraternity: SMEs. This segment is India’s economic backbone but remains financially underserved. With Tide, we aim to include them into the formal economy by delivering excellent products and exceptional service.” said Ayan Agarwal, Vice President, Transcorp. “As India’s premier non-bank card issuer, Transcorp takes pride in enabling financial inclusion for Indian SMEs, and continuously strives to deliver success to its partners through the optimisation of stakeholder alignment.”

Small businesses that are just starting out will find the business accounts helpful for their daily transactions and expenses. Being fully-digital, Tide’s Business account is not just hassle-free, but is secure and protects user privacy.

In the next year, Tide plans to introduce a few more features like Business Savings/Current Account in partnership with a RBI-licensed bank, Fund Transfer, Invoicing, GST and Pay by link and Credit services, for its members.