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The Deep Dive: Spend Management for UAE SMEs

By Puja Sharma

February 08, 2024

  • banks in UAE
  • card management
  • Cash Management

spend management

The deep dive’ is our bi-weekly exploration of a relevant topic, hot trend, or new product. For Prime subscribers only.

How does it work?

More than one in five (21%) of UAE employees and entrepreneurs say they are not submitting their expenses regularly because the filing system at work is ‘too complex’. Incorrectly filed expenses causing major headache for UAE’s SMEs.

One in four UAE employees and entrepreneurs spend more than 1 hour each month filing expenses. UAE employees losing more than 13,000 AED per year in lost expenses as a result. More than one in five (21%) of UAE employees and entrepreneurs say they are not submitting their expenses regularly because the filing system at work is ‘too complex’.

That’s according to a new report of over 1,400 UAE-based entrepreneurs and employees released by UAE-based leading spend management platform, Pemo, which shows that many people in the UAE are not submitting their expenses regularly because they say they never have time (24%) and they don’t have the admin support (21%).

The cumulative cost of an inefficient corporate expense management system amounts to an average of 13,206 AED per year in lost revenue for at least a third of the working force (35%), which many companies and their employees are simply unaware of.

Who is under the radar?

From an employer perspective, incorrectly filed expenses are causing major challenges – especially for the SME market, where businesses simply do not have the resources or the time to be dealing with bottlenecks in administrative processes. Lost receipts, inputting errors and inaccurate submissions are proving to be a big headache for businesses, which as a result, is seeing employers’ attention diverted away from growing and scaling the business because they are spending too much time having to deal with expense management issues. Over time this will impact the productivity of the business, ultimately slowing their ability to thrive.

“Expenses can often be the bugbear of an employee’s monthly routine. But our research shows that the cumulative cost of not doing our expenses becomes a dominoes effect in lost revenue. This needn’t be the case, yet employees throughout the UAE are losing staggering amounts of money year on year because the process is often too complex and time-consuming. We may as well be throwing money out the window.” Ayham Gorani, Co-Founder of Pemo, said.

The majority of our frustrations with expenses are down to the time it takes, with more than one in four of us (26%) saying it takes us approximately one hour to do our expenses each month. For 7% of people it takes more than three hours per month. Challenges relating to receipts (26%), manual expense reports (25%) and expense approvals (22%) are just some of the hurdles we have to contend with. As a result, many of us are seemingly forgoing our expenses, which is seeing an accumulation in lost revenue that is building every month.

But despite not always doing our expenses, it seems very much a case of ‘business as usual’ for the vast majority of the UAE’s employees; with typical corporate spending taking place on transportation and taxis (15%), hotels and accommodation (13%) and on flights (12%). Many of us spend with our own cash for reimbursement (29%), 25% of us use company petty cash and the same number (25%) use our own company credit card.

Why does it matter now?

Valerie Konde, Co-Founder of Pemo, said, We work in a region where more than 90% of businesses are SMEs, and as evidenced by our research – many of these businesses rely on cumbersome, manual platforms to manage their corporate spending, which are not fit for purpose.

“This creates several challenges for both employer and the employee, with lack of visibility on spend and irregular reports. This is exactly why we want to remove the friction of these daily tasks, so that we combine all spend management functions in one hub.  Ultimately, this helps businesses to save money and time, while empowering team members to make purchasing decisions quickly and responsibly.

 Gorani also noted, “By making changes to expense management systems and empowering employees by providing them with corporate cards for example, we can encourage a culture mindset change to ensure all employees are reimbursed for their out-of-pocket spend.

Nevertheless, employees are optimistic about the tools that can be implemented to help ease the burden of expenses. 51% of people from the report said they think an automated spend management system could save them between 1-3 hours per month, with 16% of people estimating it could save them between 3-5 hours per month.

“Expenses as such, needn’t become a headache; by digitalising spend management systems, automating approval flows, providing real-time cash-flow monitoring, and offering physical and virtual pre-paid cards that can be topped up and distributed to employees, businesses can have full visibility on corporate spending in real-time. These simple steps can be delivered at the click of a button, ultimately benefiting everyone in the business.” concludes Ayham.






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