When your business has multiple accounts payable, it becomes difficult for the business to rely on manual methods of payment and tracking. Most businesses face this issue when it comes to vendor payment reconciliation. Manual methods do not just involve making cheque payments and storing records on pen and paper. It even extends to traditional accounting software that involve a huge amount of manual effort to efficiently pay, process and track the payments.
Business owners usually are tempted to work with big banks for their bulk payment processing needs. What a lot of them do not realise is that they do not have access to an entire legal team like enterprises do. It is therefore more likely that a business which is relying on a sole owner to run it efficiently, is likely to suffer because of the hidden charges that are levied by the big banks. These charges are usually hidden in the extensive documentation that comes with the bank account.
It is important for a business to have a healthy cash flow. If your business has funds which can be utilised for finishing off your pending vendor payments, it is best to make those payments in bulk, as cash flow in business can change in the flick of a switch. This is where vendor payment reconciliation comes into picture. Therefore it is important that a business utilises these periods of funds availability to pay off their vendors. When this happens, a business owner needs to ensure that the charges associated with these bulk vendor payments are minimised and vendor payment reconciliation is executed successfully.
When it comes to transparency within the traditional banks, this is where they fail –
- Traditional banks in India are overloaded with customer onboardings and customer service at the same time.
It is no mystery that Traditional Indian banks have their hands full with customer onboarding and customer support, thanks to the large population density in India. Because of this exact issue, banks are on the constant lookout for spend as less time in customer onboarding as possible and more time in acquiring new customers.
- During this entire process, the customer is left to understand his/her banking operations by himself/herself. There is no clear communication on the onboarding documentation which explains the charges and fees explicitly.
- A user may only find information on all these hidden charges and fees once they do a deep dig into the bank’s documentation.
If you have had an experience with a traditional Indian bank, you might recall going through the onboarding “kit” provided to you. It is highly unlikely that ALL the hidden charges are explained in detail in that kit. You would have to do a deep dig into your bank’s website/documentation for a better understanding of this.
- Startup and SME business owners do not usually have a legal team to review all the bank documentation in order to ensure all important terms and charges are known to the business owner.
Before we find out how we can avoid these charges, it is important to understand them
- Banks have physical branches and ATM machines that need constant upkeep. There are operational costs involved in running a bank. This is why traditional banks rely on transaction fee and other hidden fees as a means of guaranteed income.
- Transaction Fee – Banks have a fixed transaction fee on each bulk payment activity. This amount can extend to more than INR 20. If your transaction values are not huge but recurring in nature, then you can end up paying a substantial amount in transaction fees.
- Other Fees – There are more than 10 various types of hidden fees that are charged by indian banks.
It is important for Startups and SMEs to understand that if their transaction values are not huge and also recurring, choosing a big bank for making bulk payments or vendor payments might result in more cash burn. Is there’s a weak vendor payment reconciliation system in place, it will make it impossible to track this cash burn and control on the same.
What is the Answer? Vendor Payment Reconciliation
Let us take a moment to introduce Karbon Payout
Karbon payout is India’s only free B2B payment platform that offers bulk payment, payout links & bulk beneficiary management in one dashboard.
Here are the top reasons why our customers love us
- What you see is what you get
Our team is 100% dedicated to expanding our business and we don’t charge any hidden fees or charges when it comes to making bulk payments.
- Your Bank might go to sleep, but we never do!
We work hard every day to ensure your transactions go smoothly. Our expert team members are here making sure that all goes well. If you ever have a problem with our site or a transaction, we will always be able to help.
- Let us help you find the payment method that suits your needs.
Based on various factors, your payment method will be decided which does not result in a transaction failure.
- 1-minute quick sign up
Quickly sign up for our service without hassle. What’s more, our onboarding and KYC process are 80% faster than your traditional bank.
- Karbon is reliable, fast and innovative.
To ensure there are no performance issues, we have a 24/7 system to process your payments. Our financial operations ecosystem speaks for itself.
- Automated tax calculations (coming soon)
Our tax calculations are fully automatic so you don’t have to worry about any form of discrepancy in your business’s books. This makes it so much easier for you and ensures a level of quality for your customers.
What does Karbon charge its customers for making bulk payouts?
Karbon payout is absolutely free to use with no hidden fees and charges. All Karbon customers can use the Payout tool without having to pay any fee for using the service.
This saves a lot of time and also money for Startups and SMEs that have small-value recurring bulk payments and makes it easier to execute vendor payment reconciliation. Thousands of companies have already moved to Karbon Payout and they are loving it. Move to Karbon today and avoid all hidden fees charged by your bank.
Growth VP @ Karbon
How payout acts as a good tool for vendor payment reconciliation?
Payout links – Best way to reconcile all vendor payments
Member access for payout – rules
Why do vendors prefer working with businesses that use Karbon Payout?