How difficult can life be for a businessman?
Running a business. Floating it through the covid crisis. Make Vendor payments promptly.
The struggle is real.
What adds to this struggle is, when you have multiple accounts payable, and you are forced to use a traditional big bank to complete the process.
At the end of the month when you look at your balance sheet, you realize something isn’t right. You would recognize some transactions that you never made! Neither was any SMS/email alert sent to you regarding the debit of these amounts.
On further checking the details, the transactions contain some terms which you do not fully understand. Many Startups & SME business owners find themselves in a very similar situation all the time.
For a business owner, it becomes a rather painstaking process to understand all the hidden charges since there are just so many accounts payables to handle.
Many times, businesses are charged without even being informed. This creates a cash flow deficit in the long run and ultimately hampers business growth.
Another issue is with almost 90% CFOs choosing different digital options for vendor payment processes, it almost seems like a nightmare to choose the right software for your own business.
In this blog post, we discuss how to choose the best vendor payment software, while avoiding hidden bank charges at the same time.
Table of Contents
To speed up the everyday AP process, vendor payment software is used, that automates every payment process.
It includes invoice scanning, automated approvals, timely payments and even global cross-border payments. It additionally ensures tax compliance and fraud prevention with safe cyber security.
It keeps a strict tab on the debts and liabilities of the company.
Banks charge you a certain “penalty” if your account balance goes below the minimum requirement agreed upon while opening the bank account. For each default, you may be charged anywhere between Rs 200 to Rs 500 per default case.
Banks inherently want to discourage users from transacting in their physical branches which makes it more expensive for the bank rather than an ATM or online transaction. Some banks charge Rs 50 to Rs 200 for this service!
Because banks need revenue to operate and maintain their physical branches, they charge a certain amount of fee even off online money transfer methods like RTGS or NEFT. This amount is typically between Rs 5 to Rs 25 per transaction.
Based on the card, banks charge a certain amount of fee that varies from Rs 100 to Rs 500 based on the slab. Additional charges are levied for any additional cards under the same account.
RBI has now allowed banks to charge their customers anywhere between Rs 8 to Rs 20 per withdrawal in its new notification. This amount is different based on the type of card.
What started as an effective security feature has also opened up a revenue stream for the banks. Banks may charge you Rs 15 per quarter for these automated alerts.
If a cheque bounces, the penalty is levied on both – the person who issued the cheque and the person who submitted it. This amount ranges from Rs 100 to Rs 500 per failure.
Rs 50 to Rs 100 levied by any private bank to stop payment requests.
Rs 30 per book after a fixed number of books
One-time fee + recurring fee charged. Failed attempt costs you up to Rs 225.
Rs 100 to Rs 500.
Up to Rs 500 for early closing.
Rs. 100 -200 per instance in most Indian Banks.
Up to Rs 100
With the exponential “fintech” revolution in India, there has been a shift towards vendor payment software.
The biggest advantage of such a digital entity as your banking partner is the NO HIDDEN FEE model. Since these entities do not have any physical liabilities, it becomes very easy for them to digitally deliver a great banking experience.
Amongst them, a simple single dashboard design and fast transactions should be your number 1 priority. Keeping this as the base you can select the vendor payment software most suitable for your business.
That said, allow us to introduce our very own AP automated vendor payment portal- Karbon Payout.
Karbon payout is free to use with no hidden fees. All Karbon customers can use the Payout tool without having to pay any fee for using the service.
Payout will help businesses save time and money, especially startups that have small-value recurring bulk payments. Thousands of companies have already moved to Karbon Payout and they are loving it.
Don’t be left behind. Move to Karbon Payout today and avoid all hidden bank charges!
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