How this 24-year-old entrepreneur is helping MSMEs conduct their business with ease
Financial incompetence is seen as one of the main reasons for businesses to fail within the first few years of operation. While India has a thriving startup and SME culture, due to limited resources, small businesses often fail to keep a check on their financial statements and maintaining budgets.
In the initial years of working, Shristi Banka realised that most companies, especially small and medium enterprises (MSMEs), do not have proper guidance regarding their compliances when they start up.
“These companies don’t have an appropriate framework to handle their daily regulatory compliance needs,” says Shristi.
Shristi Banka, Founder, Banka and Banka CFO Services LLP
This gave her the idea to set up a professional services firm dedicated to meet the end-to-end requirements of businesses in relation to their statutory as well as regulatory compliances.
The 24-year-old entrepreneur started Banka & Banka CFO Services LLP in September 2019. Started with an initial investment of less than Rs 1 lakh, the company, which has three members and two expert advisors, already claims to have clocked a turnover of Rs 8 lakh since its inception.
Mumbai-based Banka & Banka CFO Services combines corporate and statutory compliances like direct taxes, GST, indirect taxes, regular filings on MCA, corporate governance, etc.
Shristi says, “I always wanted to create a multidisciplinary firm wherein I could offer all services to clients so they do not have to go to different places to avail those services.”
A qualified CA, Shristi's father is also a Chartered Accountant (CA). She worked briefly at Ernst and Young as well as in her father’s company M/s. Banka & Banka, Chartered Accountants, before starting her own venture, which comes under the Banka Group.
She says, “I wanted to get proper experience first, and not start off immediately, which is why it took me about two years to start my business.”
Initially, the biggest challenge for Shristi was to convince people about the quality of their work. A lot of calls would come in the form of queries from prospective clients, but very few translated into successful leads. This would often lead to disappointment, she says.
She affirms that being a young entrepreneur, she lacked the experience, but this did not deter her. In order to help people gain better understanding of the firm and to acquire more clients, they would often provide a complimentary service or two in the form of advisory or prepared an explanatory note regarding the queries of the client.
A platform for SMEs and startups
Shristi says that her focus lies in handling only those clients who come under the category of startups and small businesses.
Till now, Banka & Banka CFO Services has on-boarded eight companies, including Telangana based-Plantaerie, Mumbai-based Buildreams, and New Delhi-based MCab (which is yet to be launched).
She says, “Our USP is that we cater only to startups and small businesses because we are committed to identifying the right compliance for them.”
Shristi says that the price of delivering the services vary on the basis of the time taken to deliver. She adds that they have tried to price the services competitively. “For instance, for registration as a limited liability partnership firm, we charge Rs 7,500, and for incorporation of a company, we charge Rs 12,500. This difference of Rs 5,000 in incorporation of two types of business structures is on account of our time, efforts, and expertise involved between these two different services.”
Shristi adds that she has seen several businesses getting tossed around because of non-compliance.
“Demonetisation is a good example to look at. A lot of businesses went bankrupt and insolvent because they couldn’t handle the blow that took place more than two years ago,” she says.
However, Shristi says, the biggest takeaway from demonetisation for businesses was that the cost of non-compliance is much higher than the cost of compliance.
She also adds that in the initial years of starting the company, it would take a lot of work for them to convince people “to take the right and ethical approach rather than opting for the easy way out.”
Shristi says, demonetisation made businesses realise that it is always better to be on the good side of the law. “Everyone is much more cautious now. Everyone is a lot more aware regarding their business,” she adds.
Riding on technology
As everything is online today, going digital has literally become the norm of the day. “All this does become very overwhelming for small businesses, and that is when we step in. We want startups to conduct their business ethically, and we will take care of the rest - whether it is filing GST or advising them to not take too much debt when it is not required.”
The company provides online consultations as well as provides offline services. However, Shristi's next target is to adopt more technology in the backend process. She says, she has realised that only those businesses which use technology in some form or the other succeed in the long-term and remain least affected by ravages of time.
“We are working to integrate technology into providing services. For example, if you want to get your GST registration done, you wouldn’t have to call or email us. It would all be done online. There will be a monthly reminder waiting to be notified to upload documents, and then we will take care of the rest,” she says.
Shristi adds that the company is aiming to on-board 30 startups and SMEs in the second year of operations.
(Edited by Megha Reddy)