“Too complex” expense management systems draining time and productivity for UAE’s SMEs
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
today 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.
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.
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.
And whilst a savvy 51% of us do say that we do our expenses frequently, the process for
submitting them often seems quite complex. The average number of people who need to approve
our spend in the business is two (45% of people say this), with Finance and Accounting, Office
Managers and Human Resources being the top three departments who are involved in getting back
our cash.
Many of us do have a level of autonomy with our expenses, as we are allowed to spend a certain
amount before we need approval. 27% of us can spend up to 500 AED before we have to seek
further agreement, and 20% are allowed to spend up to 5,000 AED without prior consent.
Whilst doing our expenses can sometimes feel like a chore, when it comes to what would make our
lives easier, it seems we’re quite clear about what needs to take place. 39% said they would
welcome a user-friendly app that captures your expenses straight away, 32% said they would like
something that provided an easy way of uploading expenses into the system, and 16% said they
would welcome a tool that is linked to your card or bank account and that automatically accounts
for your receipts.
“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.
Valerie Konde, Co-Founder of Pemo, agrees:
“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.
Ayham Gorani thinks the fixes are simple: “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.