Cut unnecessary costsIn recent years, SMEs have realised the benefits of accessing new markets and customers worldwide, and international trade is currently valued at over £700bn for UK SMEs. Our own research has shown that almost 46 per cent of SMEs expected to increase their international payments in 2016, with only 28 per cent expecting a parallel rise in domestic payments. However, such ambitions have seen many businesses stumble into a serious financial pitfall: SMEs are charged £4bn in hidden transfer fees for international payments by the major UK banks every year. Further, SMEs annually lose £8.72bn to inefficient expense management, while employees spend an average of four hours every week managing expenses and other financial outgoings. Such needless expense and time-intensity is unconducive to global business growth, but an effective prepaid programme such as PayFEX can comprehensively streamline corporate payments and enable SMEs to expand with confidence. For example, payroll managers can distribute funds with no costly per-payment fees by connecting employee prepaid cards to a central corporate account. The cards can be pre-loaded with budgets in advance, manually or automatically topped up on the move, and allow for real-time expense reporting by giving employees the power to upload receipts to the manager’s online portal.
Boost employee satisfactionSMEs account for 60 per cent of all private sector employment in the UK, with 15.7m workers in total. This means serious competition when attracting the best employees, and 43 per cent of the UK’s small business owners have reported challenges in recruiting appropriately skilled staff for their company. However, recruiting and retaining new employees is crucial for business growth, with 27 per cent of decision makers at SMEs hiring new people as a top initiative when expecting a period of business growth, and 23 per cent of senior HR professionals most concerned about keeping important staff without large financial incentives. One way to ensure an undesirably high staff turnover rate is to pay employees incorrectly, or late. 44 per cent of European employees have been paid late, with 48 per cent having also been paid incorrectly. Importantly, 41 per cent of UK employees have considered leaving their job after such inefficiencies. Business leaders must address this needless issue to avoid falling behind competitors. Again, payroll managers can sync prepaid cards to a central fund account to streamline the payments process. This enables instant distribution of funds without waiting for payments to clear, regardless of global location. Managers can also use the portal to set up automated SMS alerts to assure employees that they’ve been paid on time.
Streamline complianceHiring flexible workers such as freelancers and gig economy employees is an increasingly popular recruitment strategy for SMEs. Such a lean relationship can be beneficial for both employer and employee, but many payroll managers have previously tried, knowingly or unknowingly, to stretch the benefits too far by classifying these workers within the self-employed tax bracket. This was heavily punished by HMRC last year, which deemed such classification to be inappropriate for casual workers, and collected over £373m from SMEs in penalties as a result. The Taylor Report, which was commissioned shortly after HMRC’s crackdown to assess modern working practices such as the gig economy, has recently sharpened the focus on this compliance management issue. SMEs cannot grow in confidence while at risk of potentially fatal fines. Instead, SME payroll managers can protect their business by using a prepaid corporate programme to classify and manage all cardholding employees worldwide. This streamlines the compliance reporting process by giving users full management of their workforce’s payments via a responsive online portal, and easy allocation of accounting categories and VAT segregations. Centralising employee records in this way means that comprehensive reports with plentiful data can be quickly produced, which gives SMEs a quick and easy way to ensure that employees are being classified in the tax brackets that they should be.
Prepaid cards: For today and tomorrowThere’s no question that technology has accelerated the evolution of workforce and workplace alike. But as many look to the future of artificially intelligent and fully automated corporate payment solutions, many business leaders are yet to realise that by deploying easily-integrated tech solutions, they can leverage crucial business efficiencies today. Those that effectively harness prepaid technology to streamline corporate payments can gain a considerable advantage over their competitors. Such a small change can yield big rewards. [rb_inline_related]
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