Indian companies were caught unawares when the Goods and Services Tax (GST) was implemented across the country from July 2017. The multi-stage, destination-based indirect tax needs to be compulsorily filed by businesses on a monthly, quarterly, or annual basis. 

Since then, many companies are trying to simplify this process for businesses big and small. Kanpur-based Pinnacle Finserv Advisors Private Limited is one of them.

Founded by Satish Bhatia, Abhishek Porwal, and Arjit Gupta in 2009, the company aims to provide technological solutions in the fields of taxation, finance, and e-governance with its product, myGSTcafe, which was launched in 2017.

The offline application is designed for corporates and tax professionals take care of end-to-end GST compliance and help businesses file their returns without hassle.

Speaking to YourStory, Arjit, who is a chartered accountant, says the myGSTcafe software needs to be installed and can run offline. The software helps businesses claim GST Input Tax Credit (ITC), and complete GST audits and reconciliation. It also helps prepare decision-making business reports.

How myGSTcafe helps businesses

“The major pain point about GST for corporates and businesses is the fear of losing their Input Tax Credits (ITC) if it does not properly reflect in GSTR-2A (returns providing details of the inward supplies, TDS and TCS) in a timely manner,” Arjit says.

This, according to Arjit, not only blocks the working capital of the company, but also increases the employee cost in GST compliance and the possibility of losing the GST Refund or ITC. 

He explains that the reflection ITC figures in GSTR-2A returns are dependent on the product supplier’s GST compliance process, and businesses will have to follow up with vendors and regularly match their Input Tax Credit with GSTR-2A, which is a time-consuming process. 

“The AI algorithms of myGSTcafe software analyses the patterns of invoice number and transactions, and matches the GSTR-2A with the purchase register easily within a few minutes,” Arjit says.

Apart from this, the software also has an inbuilt vendor follow-up feature, which automates the entire vendor follow-up process.

The business model and more

While myGstcafe is a B2B solution, Pinnacle also offers a B2C solution named MyTaxCafe helps people to electronically file their income tax returns easily and within a short time in just seven steps.

Though Arjit refuses to disclose details about the revenue generated and the company’s business model, he explains that the company charges the businesses for buying the myGSTcafe desktop software.

Apart from this, it also charges businesses based on the number of invoices the software has to process. Arjit says the basic software can cost an organisation anywhere between Rs 50,000 and 75,000.

When asked why Kanpur was selected as the company’s headquarters, Arjit says he always wanted to create a platform to give opportunities to students and young talent in the city.

“Kanpur faces a talent crunch as people move to Tier I cities for development. This is one of the major reasons behind inequality in development, compared to other geographies,” Arjit explains.

This venture is a part of the effort to provide a platform to help people gain experience, retain talent, and later create more opportunities.

myGSTcafe counts names such as Hawkins Cookers Ltd, MRF Ltd, Ashok Masaley Limited, Kanpur Edibles Ltd, Parakat Group (Kerala), and Crystal Sarovar Hotels (Agra) as its clients.

It claims to have over 15,000 registered users, including CAs, corporates, and tax professionals on the platform.

On the COVID-19 situation, Arjit says while the company is at an advantage in a way since it is compulsory for eligible businesses to file GST returns, business might be affected to an extent because organisations may need to slash their budgets due to the lockdown.

In November 2019, myGSTcafe received the GST Suvidha Provider (GSP) licence from Goods and Services Tax Network (GSTN). 

Competition and the future

“We are currently bootstrapped, and I think we would like to remain so for at least next four to five years,” Arjit says. He believes that the bootstrapped stage helps them to optimise available resources in more efficient ways.

He explains that myGSTcafe faces major competition from the government’s own GST portal as the government is making all efforts to make GST filing easier and with free utilities. Apart from this, it also faces competition from other private players such as ClearTax, Master India, and other GSPs. 

However, Arjit believes that the differentiator is the fact that their model is an offline software. “Most solutions that are cloud-based are expensive and businesses may also hesitate about data privacy,” he adds.