INTERVIEW: Uhasibu Country Manager Angela Nzioki on Developing a Digital Accounting Solution to Empower SMEs

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What is Uhasibu and how did the need for developing it come to be?

Uhasibu is Kenya’s best online accounting package for small and medium sized businesses (SMEs). In a country where SMEs drive the economy of the country, they are terribly neglected when it comes to solutions that work for them. Most solution providers focus on bigger well established businesses leaving SMEs to figure it out on their own. Available accounting and payroll packages are built focusing on these bigger establishments and are thus too expensive and also don’t focus on how SMEs run their businesses.

These are some of the needs as to why we built Uhasibu. It focuses on the exact working environment that SMEs in Kenya operate in and is integrated with local stakeholders to enable SMEs submit some of their statutory deductions directly through the system.

How do your digital solutions increase efficiencies?

All our digital solutions are built to make work easier for the people using them. Take the payroll module of Uhasibu for example, it’s integrated with NHIF, KRA, NSSF, NITA amongst others. Ordinarily, an SME would have to figure out how the digital solutions that all these entities have work, then try and submit through their portals and then proceed to make the payments. Most of these processes are not easy and they take a skilled individual to figure them out and a lot of time. With Uhasibu, any SME just needs to click 1 button and the system automatically submits all their statutory deductions to the respective entity and they are only left with making the payments. A process that would otherwise take a couple of hours, is very quickly reduced to a few minutes.

 Why do you specifically target SMEs with your solutions?

SMEs are the backbone of our economy yet they are largely neglected. In order to keep them sustainable, we need to provide them with solutions that work for them. Solutions that are affordable, make their work easier and make them scale faster and we believe that accounting, bookkeeping and proper financial management is one of these solutions. Accounting is boring, but it is one of the most vital things to the survival of a business.H__1491565900_10843

From your assessment, what is the level of disconnect of SMEs from the payroll rules and regulations of Kenya?

They say ignorance is bliss but they lied. The level of ignorance that SMEs have in regards to the payroll rules and regulations is alarming. In my line of work, I meet a lot of SMEs that want to find “creative” ways to manage their payroll for their employees because they are afraid of the misconception that doing it right is costly. Yes, it is not easy to figure out, and thus solutions like Uhasibu, but neither is it costly. It is only costly when they are caught doing the wrong things and they do this in the first place due to lack of information which is not entirely their fault. A lot of our government agencies barely understand some of the procedures that they have implemented themselves. It normally takes a few trips to a respective organization and talking to several people to get the correct information but once you have that, then managing your payroll becomes very easy and very cost effective. And we understand that not all SMEs can be able to go digging for this information and that is why we take it upon ourselves to be the go-to company when it comes to all things payroll management in Kenya.

What strategies are you implementing in helping SMEs become acquainted and compliant with Kenyan regulations?

For us to implement any solutions, we need information. While in the process of gathering this information, we realized that it is not enough to just incorporate the information we gather into our solutions but to also share it with the larger SMEs industry and keep them informed. This is why we started writing our blog, Kenyamanual.co.ke – the missing manual for the Kenyan startup. On the blog we share vital information on how an SME can manage the red-tape that is the Kenyan bureaucracy. There are simple articles talking about how to do their tax returns one iTax for example or how to register for NHIF and NSSF amongst others. In 2014 the blog was on the finalists list of the Best Business Blogs at the BAKE awards. Besides from our solutions actually making it easier for SMEs to become compliant, the blog is also a way to give back to the SMEs and help them become acquainted and complaint with Kenyan regulations.

Do you directly work with local legislation authorities and what challenges have you encountered, if any, working with them?

We don’t work directly with them, although we would love to be in partnership with all of them. What we have done, is figured out how their digital systems work and directly integrated our solutions with theirs. The challenge we have faced in this process, is that the digital systems of the local legislation authorities don’t have open APIs (Application Programming Interfaces) that would make it a lot easier and faster to integrate any system with theirs and because of this, it takes us a lot of time to make the integrations work, time that could otherwise be spent helping more SMEs get compliant a lot easier and faster.

Can you evaluate the cost effectiveness of your payroll management system in contrast to the traditional systems?

Traditional systems have an all up-front payment method which in most cases is hard to manage for an SME that is not yet cash-flow positive. This makes a lot of such SMEs put a hold on implementing a system until at a later date when they can afford it, leaving time to pass. Within this time, they are still running their operations and running blind. They can’t tell exactly how the business is doing and cannot plan for the future. With Uhasibu and our payroll management system, we have a monthly subscription model of Ksh1, 000/$10 monthly. An amount that any SME can be able to afford on a monthly basis to get the value of a fully functional accounting and payroll management system. This business model supports their cash-flow challenge and allows them to know exactly how their businesses are doing from the very beginning allowing for better decision making and potential business growth.CSV__1491565753_25049

Uhasibu offers free monthly training sessions; can you shed more light on this?

We used to but we stopped the monthly trainings and instead focused on one on one trainings with clients. This is a more effective way of doing it as it allows us to focus on the exact challenges that a client is facing. A generalized classroom training was good enough to give a client the general idea of how the system works but what keeps the clients paying every month, it the continued support that we offer and that is why we chose to focus instead on one on one trainings. Free of charge of course. It is part of our customer support.

Have investors shown interest in Uhasibu and is the company open to incubation?

A number of investors have shown interest in Uhasibu but we haven’t yet secured any outside funding. We are still organically growing the company, focusing on customer acquisitions and retention and growing from revenue. When the time comes, we will consider outside investment but for scaling purposes, that is, to venture into the rest of East Africa and replicate the success we have had in Kenya.

We are not open to incubation as we already went through incubation. At the launch of Uhasibu, in September of 2011, we were at the time being incubated at m:lab East Africa. This was after we won the Enterprise category of the Pivot East (then Pivot25) competition. Winning the competition entailed some proceeds into the business and incubation at m:Lab for roughly 24 months.

What are Uhasibu’s projections for the future in the region’s technology consumption space?

Still challenged – from experience, the region/ market enjoys the idea of good technology but any company would be better placed providing a service and using technology as an enable. As a region, we are still far behind from completely embracing technology for our businesses. Solutions providers still have to think critically about ways to make the technology work for the market without the market itself being the ones handling the technology. What the market needs more and right now, is services. Which is why we offer bookkeeping and payroll services as a complementary to the technology for SMEs that are looking for the value offering of our technology but do not have the expertise to manage the technology themselves.

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