As part of the tax saving methods that we use, many of us queue up every month to collect our Sodexo coupons, which can be used in office canteens, or many restaurants, and various stores as well. It's a useful way of bringing down your tax burden legally, but the truth of the matter is that Sodexo coupons are inconvenient to manage and use. In an age where there's an app for almost everything, it's no surprise that there are startups working on this exact problem.
Gadgets 360 caught up with two Bengaluru-based startups, Zeta and Niyo, to find out how they've been approaching the problem. Ramki Gaddipati, co-founder and CTO at Zeta, tells us that the company has brought the whole process online, with absolutely no paper involved, as is the case with Niyo too. The two companies both offer solutions for payroll management, as well as reimbursements and other payments, and they use a combination of mobile apps, physical cards, and Web-based management to handle things.
When your employer signs up with Niyo, you get a "Benefits card" that's issued through Yes Bank, while Zeta gives you a "Super card" issued with RBL Bank. Niyo's card uses either Visa or MasterCard, while Zeta supports the latter, and RuPay. These cards can be used to pay for food, buy fuel, or cover your medical bills, and these expenses are tracked against your reimbursements automatically.
Vinay Bagri, CEO and co-founder at Niyo, tells Gadgets 360 that his customers include a Hero group company, Cafe Coffee Day, and Harman, to name a few. "We are working with over 100 large companies, and over 50 SMEs right now," says Bagri. Zeta, which has been around for longer, has around 600 customers, addressing around 100,000 end users [the employees], according to Gaddipati.
Companies can set up limits, determine how much money is paid out to these cards, and so on. With Niyo, the company can also set up specific buckets, explains Bagri, so that the card can be given different balance amounts for various types of spending.
"When you use the card at a PoS machine [a card swipe machine], it sends a code so that we know what category of merchant you are using it with, and then the amount can be automatically deducted," explains Bagri, "and your company can also be informed so that your tax reimbursement can be applied. You might have to take a picture of the bill on the spot, which the app lets you do, and you'll still need to keep a physical copy, but you won't have to apply separately for this or do anything extra.”
For the end users, these cards offer a simple solution for managing their reimbursements and allowances. Like the Niyo Benefits card, the Zeta Super card also offers similar functionality, but Zeta has also built its own payment systems. Merchants with a PoS terminal can also accept payments through a smartphone app, and even without that, a Zeta user can make a payment to a merchant by sending the money to their Zeta code. In Bengaluru, it's not unusual to come across rows of shops bearing the purple Zeta logo. It's not entirely clear what header you would be claiming that expense under at each shop, but it does show that these apps are also growing in their reach.
Another benefit of going digital is that the companies are able to provide mobile apps that also have very interesting features. For example, Bagri demonstrates the Niyo app, showing us how you can use it to track all your expenditures using the Benefits card, as well as how much you can claim under reimbursements. The app also lets you lock the card in case it’s lost or when it’s not being used.
"We advise people to keep the card locked when they aren't using it," says Bagri. When the card is locked, it can't be used at a swipe machine. "Your Niyo account can be your salary account also, so you might want to disable the card except at ATMs, for example. Or you could disable it for everything apart from fuel bills."
"Even if you lose your card then, you don't have to worry, you can disable it yourself without having to call the bank," he adds.
These companies are innovating in other ways as well. For example, Zeta recently launched a product called Super Tag, which is an NFC tag that can be attached to your wallet, your ID card, or any other place you prefer. This can be linked to your food reimbursements, for use in the company cafeterias.
"We built this for use only in offices, for food payouts, to make the office cafeteria more efficient," explains Gaddipati. "When you have to pay using a voucher or using a debit card, it can take time, from 10 seconds to upto 60 seconds in a problematic transaction. That's a big problem when you're a company with thousands of employees all queuing up to grab their lunches."
"The Super Tag is an NFC tag that you can just press against a reader and immediately the transaction is made, so it makes this much more efficient," he adds. "Internet reliability is also not a problem because this can make the transaction offline, and then complete it once the connection is restored."
The question is, what's preventing the industry leader, Sodexo, from bringing out features like these. Sodexo has an Android app, to help you find merchants who accept the physical vouchers, but for now your Sodexo vouchers remain physical coupons. As Bagri points out, the company has a massive infrastructure already in place around the paper business, which makes it harder for it to change now.
Gadgets 360 also reached out to Sodexo over a week ago and we haven’t heard back yet. In a post-demonetisation world, people are getting used to managing financial transactions through their phones, and that means that companies like Zeta and Niyo are going to look even more attractive, especially when the alternative is walking around with booklets full of vouchers.
Update: After this article was published, Sodexo contacted Gadgets 360 to share that apart from meal vouchers, it also offers a card-based payments system, and is now piloting mobile payments.
"We launched a card-based payments system, which replaces the vouchers with a card but instead of Visa or MasterCard, it uses our proprietary network," explains Suvodeep Das, VP Marketing for Sodexo India,
The Sodexo card can only be used at specific merchants - there are some 15,000 in 700 cities already, Das tells us. The company has also piloted a mobile payments system in Mumbai, based around QR codes and the card PIN for authentication, which it will roll out to other parts in four to five weeks time.
"Right now many companies we've talked to are waiting for the end of the financial year to start phasing in these options for their employees," he says, "while others who prefer the paper voucher still have that option."