Maybank helps SMEs with digital transformation

Source: Maybank. Leong.

In November 2017, Maybank Singapore partnered with Asian Business Software Solutions (ABSS) to empower startups and micro businesses in Singapore with Financio, an affordable cloud-based accounting solution which does not require any accounting knowledge to operate.

Almost a year on, Maybank's Marc Leong, Executive VP and Head SME Banking, Community Financial Services, shares that one in every five small and medium sized enterprises (SMEs) which open an account with the bank is also signing up to use Financio.

"Despite being in Singapore, adoption of the cloud is far from satisfactory," he said at the recent Accounting & Finance Show Asia 2018 in Singapore. He estimated that some 60% to 70% of small businesses are still working with offline software, or even doing their book-keeping manually.

"The bank has a deep role to push the go-digital (trend)," he said. Another digital initiative from Maybank, executed together with Financio, is PayNow-ready invoicing. In September, Maybank Singapore and Financio launched unique PayNow QR codes with embedded payment details, enabling funds received via PayNow to be easily tracked in Maybank’s Business Internet Banking and updated directly in the ledger.

PayNow is a peer-to-peer payment service that has been available to retail customers of nine participating banks in Singapore since July 2017. The generic PayNow QR codes had lacked enough payment details to identify what was being paid for.

More announcements are planned for later in the year, Leong said, around the Singapore government-driven SMEs Go Digital programme, and also a new branch along main tourist belt Orchard Road which will incorporate a digital bank in a cafe.

"We're taking this role seriously," Leong said. "It is an ecosystem play, leading from the SME to the bank to fintechs...This will be the trend. If you don't want to join it you will lose out."

Leong also shared that Maybank is locally incorporating its Community Financial Services business in Singapore. "By November 5 we will be fully incorporated," he said. "It is a huge step for us, a surefire way to tell the world and Singapore that we are here to stay."

Since PayNow Corporate was launched on 13 August 2018, close to 2,000 Maybank customers have signed up for the banking service to receive or send payments between businesses and individuals instantly with just a Unique Entity Number (UEN) or a PayNow QR Code.

Maybank and Financio shared the same booth space at the event.

The Maybank reception counter.

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Maybank Singapore is promoting Financio and PayNow with initiatives such as:

- Maybank is offering the first 12 months free for Financio. The premium plan usually costs S$9.95/month.

Maybank PremierBiz or FlexiBiz account holders can sign up for Financio by:

Applying and activating Maybank Business Internet Banking.
Registering for Financio upon account opening by completing a consent form.
Completing an ABSS GIRO form for subscription fee deduction (applicable for the Financio Premium Plan).

- From now until 31 December 2018, business banking customers stand to receive S$88 cash credit when they process a minimum of S$10,000 in incoming funds collections via PayNow for three consecutive months.

- Maybank Singapore is waiving all transaction fees on PayNow until December 2019.

SMEs can up for PayNow via Maybank’s Business Internet Banking platform or with a paper form.

Xero makes cloud-based accounting software that's designed for business owners

Fitzgerald.

Small and medium sized businesses (SMBs) are still hesitant to get on the cloud, despite the large advantages that await them.

Kevin Fitzgerald, FCCA, Regional Director, Asia at Xero, which provides cloud-based accounting software, said that adoption of cloud is still a barrier when it comes down to accounting. Xero's potential customers often have security and privacy concerns, he said at the recent Accounting & Finance Show Asia 2018 in Singapore.

"They don't realise that they are already in the cloud if they use a banking app or an email server," he noted.

The cloud subscription model can also put SMBs off as they are more used to buying a static product for a one-off cost, as opposed to paying monthly for a service which is continually updated over the course of the subscription. "We don't charge extra for updates," he explained. "Last year, we rolled out over 2,000 (improvements). You don't get that with desktops."

Over a million businesses around the world have seen the light. As of March 2018, 1.4 million business are using Xero, Fitzgerald shared.

"Our mission is to help SMBs," he said. "They don't need a US$20,000 experience with very heavy software."

Xero charges US$40 a month* per company for premium accounting services excluding payroll, covering any number of users.

Besides the cost, another Xero strength is the number of third party software which talk to the Xero system. There are over 700 add-ons that Xero customers can take advantage of to enrich their experience.

As the service was built originally for business owners rather than for accountants, it is extremely intuitive, Fitzgerald added. When Xero is contrasted with desktop accounting software, the desktop alternative tends to look clunkier, with a slower user interface, he said.

"You can understand it and navigate it very quickly," he said. Xero's dashboard is particularly helpful for SMBs, as it displays details on cashflow, what bills need to be paid, and the money which is due to them.

The company has 25 offices around the world, including in New Zealand, Australia, Singapore and Hong Kong, and is planning to expand. Xero hopes to add 10 more people to the 26 in the Singapore office, for instance.

"There is great talent here, the understanding of accounting, of SMBs and of the cloud market is powerful here," he said, adding that the government grants available are also a draw.

"It is a great place to do business," he said.

With Xero's cloud-based service accessible from anywhere in the world, Xero's Asian business is very active even where it has yet to have a direct presence. The company is particularly busy in Malaysia, Vietnam and the Philippines, he said.

The company recently introduced changes to leave entitlements for its more than 2,000 global staff to promote and encourage a safe and inclusive environment for everyone at the company. Introduced on World Mental Health Day, 10 October, the new Wellbeing Leave means Xero staff can take leave for physical or mental illness, to cover medical procedures, when a partner or dependent requires care, but also for their own personal wellbeing.

Employees in Singapore will receive 14 days paid leave in addition to annual leave to care for their personal wellbeing, without the need for medical certification. Employees also have access to the Employee Assistance Programme which allows those who are undergoing a traumatic life experience such as chronic illnesses or the loss of a loved one to reach out to a dedicated helpline committed to providing guidance and help through a difficult process. 

“People come to Xero to do the best work of their lives, which is why it’s vital we support not only their physical wellbeing, but their mental wellbeing as well,” said Rachael Powell, Chief Customer and People Officer at Xero.

“Mental illness and poor wellbeing is something that affects many people, including small businesses; most people will encounter it in themselves or someone they love during their lifetime. We cannot afford to ignore it.

“When we get this right, our people go from functioning to flourishing, which means that everyone inside Xero is set up to play to their strengths and do their best work.”

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*The Australian premium service includes payroll, and costs US$100 a month.

PwC calls on Singapore businesses to improve cash management

Businesses in Singapore need to focus on improving their cash management to mitigate risks, fund their day-to-day operations and finance their growth plans. 

The Singapore Working Capital Study 2017* by PwC Singapore and SPRING Singapore has found that over the last three years, businesses in the city state saw an average 2.6% decrease in revenue year-on-year. There has also been a year-on-year increase of 3.5 net working capital (NWC) days** over the past three years, reaching 41.5 NWC days in FY16.

Said Wee Tze Wee, Deals Strategy and Operations Partner, PwC Singapore: “Working capital is akin to the lifeblood of a company. Optimising working capital is crucial as failure to manage it properly can have serious implications on the success of a business – from funding day-to-day operations to its ability to fund growth.”

This year’s results show that 50% of sectors saw their working capital performance deteriorate year-on-year (YoY). This performance was driven by an increase in the time taken to collect cash from sales (days sales outstanding) and an inventory increase (days inventory outstanding), partially offset by an increase in the time to pay creditors (days payables outstanding) that might not be sustainable in the long term.

Very large companies perform best with the highest ratio of working capital to sales at only 8%, followed by small companies at 14% and large companies at 15%***.

Medium-sized companies are the ones struggling the most in managing their working capital with the highest ratio at 18%. Their cost for growth is higher, increasing their difficulty in accessing funding at favourable rates. They find themselves battling for cash while having little negotiating power. Inadequate proficiency in managing a growing business coupled with lagging tools and systems can also add to poor performance, PwC said.

By the nature of their size, very large companies can leverage economies of scale and have easier access to capital at more attractive rates. On the other hand, small companies tend to have less complicated operations, making working capital management more straightforward.

In addition to the cash benefits of funding day-to-day operations, effective working capital management can help businesses improve business performance and revenue growth. Companies that have been able to achieve top quartile working capital performance have outperformed their peers across various key metrics, PwC said.

Some top performers are clearly ahead with higher investment rates, getting paid 40% faster than bottom performers and holding four times less inventory. Top performers are better positioned for growth as they can self-finance part of their investments or secure funds more easily by displaying healthier financial reports.

Leading players ‘stress test’ their working capital process, striving to balance the trade-off between cash, cost and service. They measure compliance with terms, processes and policies with key performance indicators (KPIs) to monitor working capital; and they benefit from top management sponsorship and clear accountability for working capital management.

Based on the findings, PwC says businesses in Singapore need to focus on cash management, specifically working capital, to better position themselves for funding and investments, and to allow them to create greater business value.

Chew Mok Lee, Assistant Chief Executive, Capabilities and Partnership Group, SPRING Singapore said, “Cash flow management has consistently surfaced as a challenge in local small and medium sized enterprises (SMEs) and SMEs do need help in this area. With this joint benchmarking study with PwC Singapore, SMEs can now see how their working capital performance is against their industry peers, tackle shortcomings in their cash collection cycles and find ways to improve their financial health for sustainable growth.”

*The Singapore Working Capital Study 2017 is a joint report by PwC Singapore and SPRING Singapore. The study looked at over 1,000 public and private companies across 15 industries in Singapore, including marine and offshore businesses that were reviewed separately in the sector analysis in the third chapter of the report. 

**Net Working Capital (NWC) days measure the liquidity of a business and how long it takes to convert its working capital into revenue. The longer the cycle is, the longer a business is tying up capital in its working capital without earning a return on it. Therefore, companies strive to reduce their working capital cycle by collecting receivables quicker, improving their inventory management or sometimes stretching their accounts payable. This key performance indicator (KPI) should be considered in the context of the industry that the company operates in.

NWC days is calculated by taking sales (days sales outstanding – DSO) and inventory (days inventory outstanding – DIO), offset by the time to pay creditors (days payables outstanding – DPO).

Calculation of NWC days: NWC days = DSO + DIO - DPO 

***Company sizes refer to companies by revenue, defined as:
Small-sized companies: less than S$10 million
Medium-sized companies: S$10 million to S$100 million
Large-sized companies: more than S$100 million but less than S$500 million
Very large-sized companies: more than S$500 million

Cloud-based accounting solution designed for non-accountants

Asian Business Software Solutions (ABSS) today announced the launch of Financio, a cloud-based automated accounting software for micro and small businesses in Singapore that gives companies access to a secure solution that tracks business finances.

Developed by ABSS and powered by Microsoft Azure, Financio does not require any accounting knowledge to operate and is designed to be used by non-accountants. Users can track sales, purchases and miscellaneous transactions through a simplified dashboard, and automatically generate financial reports and tax records or forward transactions to recipients via email and inventory tracking. Through Financio Connect, businesses are also able to collaborate seamlessly and share documents on the platform.

Paul Conway, CEO, ABSS said: “SMEs make up 99% of Singapore’s enterprises, employ two-thirds of the workforce, and account for about half of Singapore’s GDP. As Singapore embarks on its Smart Nation journey, it is crucial for companies to start their digital transformation journey and gear up for the new digital economy. Through Financio, businesses are able to leverage accounting technology to boost productivity, drive collaboration and stay on top of their finances.

“Financio is intuitive and simple to use - it takes away most of the bookkeeping process from the business, and all users need to do is put in the sales and purchase figures. The system will do the rest such as double entries, generating reports and GST tax records.”

In Singapore, Clove Bridal Studio is an early adopter of Financio’s premium version. The professional photography agency is relying on Financio to streamline its financial processes. Fiona Liu, Sales Director, Clove Bridal Studio said: “As entrepreneurs in this information age, we were looking for an all-in-one solution that could help us simplify the traditional time consuming bookkeeping methods, and putting our focus on delivering more value for our customers and growing the business. With Financio, we have digitised our accounting operations with the cloud and will save over S$1,000 and 100 man hours a year.”

Jye Eng, CTO, Financio said: “Financio is currently powering more than 4,500 small businesses across Southeast Asia today, and saving over 384,000 man hours a year. We are seeing more customers adopting software-as-a-service (SaaS) on a subscription service basis, and realising the benefits of accessing data on the go. Companies that are processing information offline should now be looking to do this online.”

Financio also offers features that include multicurrency support, real time backup, Singapore GST support, file storage for attachments to transactions and is also available in Malaysia. ABSS is also looking to deploy its solution to SMEs in Philippines, Hong Kong and Indonesia.

Interested?

Small business owners can use Financio for free for up to 10 invoices monthly, and upgrade to the premium version from S$9.95 a month. Register

Kofax releases version 9 of Readsoft Online

Kofax, a provider of software to simplify and transform the first mile of business, has launched release 9 of ReadSoft Online, a cloud-based capture and invoice processing solution.

ReadSoft Online gives small and medium sized business (SMB) customers an affordable, flexible way to automate accounts payable processes.  ReadSoft Online captures invoices, extracting invoice data and exporting verified data to enterprise resource planning (ERP), accounting and other applications. Built on Microsoft Azure, it can be set up quickly and requires much fewer IT resources than an on-premise solution.

"The cloud is changing the face of accounts payable (AP) automation," said Reynolds C. Bish, CEO, Kofax. “ReadSoft Online R9 leverages the cloud to offer the best capture, extraction and validation solution for invoice processing and AP automation. The solution provides immediate ROI and generally yields up to an 80% reduction in costs due to fewer labour intensive, manual processes and improved cycle times.”

ReadSoft Online R9 builds on previously released features including multi-language support, line item extraction, supplier recognition and Excel import for master and purchase order data and reporting. As a cloud-based solution, updates and enhancements are deployed in an automated manner allowing customers to access new features as they are incorporated into the product.

Key enhancements include:

+A new HTML5 interface that makes it easier for developers to make changes with little or no training.

+Upgraded data capture capabilities such as easy identification of country-specific invoices, improved custom extraction fields and enhanced auto learning

+Better extraction of key analytical data for reporting

+Third party integrations made seamless

Intuit Singapore to launch hit expense management app

Intuit, the global small business management and accounting software solutions provider, plans to launch QuickBooks Self-Employed in Singapore. The software allows users to stay on top of business expenses. QuickBooks Self-Employed launched in the US in 2015, and has 180,000 customers globally including in Australia, up from 50,000 a year ago.

Scheduled to be available later this month, QuickBooks Self-Employed is a mobile app targeted to help the growing freelance workforce. The app features expense tracking, invoicing, and helps users get better insight into their financials including net income and tax obligations throughout the year.

According to the Manpower Ministry’s 2015 Labour Force Report, 14% of Singapore’s workforce are self-employed. A growing part of this is the on-demand economy, which in Singapore includes global platforms such as Uber and Airbnb as well as strong local market players PandaBed, GrabTaxi and Redmart.

“The Singaporean self-employed community will benefit from a service that allows them to effectively stay on top of business expenses and make better financial decisions,” said Ashley Millbern, Head of global expansion at Intuit. “We know that these workers face unique challenges compared to traditional, full-time employees. QuickBooks Self-Employed will help them get organised and simplify their financial tasks, untangle business and personal expenses, and help them get ready for tax time; a task that used take hours can now be done in just minutes, and right in the palm of their hand.”

QuickBooks Self-Employed features include:

• Tracking expenses on the go with easy category selection based on swiping left or right on the phone
• Link receipts to expenses through the app
• Create and send invoices with notifications when the invoice has been viewed.
• Snap and store receipts, manage expenses, and invoices in one place

For more than three decades, Intuit has worked closely with customers around the world throughout the product development process. Customer input is critical to determine what big, unmet needs they are facing, what solutions Intuit should create, and how the products will look and feel. Intuit is also inviting Singaporean self-employed workers to be part of the product development process by joining a product testing programme to provide input and feedback on the mobile app.

Interested?

Sign up to test the software

Malaysian Institute of Accountants publishes book on MPERS standard

To assist members in the implementation of the Malaysian Private Entities Reporting Standard (MPERS) Framework in Malaysia, the Malaysian Institute of Accountants (MIA) has unveiled a book on MPERS, Illustrative MPERS Financial Statements, with Commentaries.

The book has been prepared by the Institute to guide members in their transition to the MPERS Framework. The book covers all 35 sections of MPERS, including the transitioning requirements.

MIA President Dato’ Mohammad Faiz Azmi said that private entities can no longer apply the Private Entity Reporting Standards (PERS) framework. These entities have to now make a choice of either migrating to the full blown Malaysian Financial Reporting Standards (MFRS) Framework or the MPERS framework, which is tailormade for them.

“The accounting requirements and treatments in MPERS are substantially different from those in the previous PERS Framework used by private entities in some areas,” he said.

“There are also some complex and highly technical areas, such as accounting for business combinations, consolidation, financial instruments and agriculture that require sufficient knowledge not just in accounting per se, but also in finance and economics.”

MPERS is an adaptation of the International Financial Reporting Standards (IFRS) for Small and Medium-Sized Entities issued by the International Accounting Standards Board (IASB) in 2009. By adopting the MPERS Framework, private entities in Malaysia would be able to bring their financial reporting to be in tandem with the current global financial reporting. The MPERS Framework is effective for financial statements beginning on or after 1 January 2016.