With NSDL rates out in open, GSPs gear up for a price war
Synopsis
GSPs and ASPs say though pricing may vary at the outset, after a while, a single pricing model would emerge gradually in the market
By Mugdha Variyar, ET Bureau
Last Updated:
BENGALURU: NSDL e-governance Infrastructure has announced its pricing for taxpayers under the Goods and Services Tax regime, becoming among the first GST service providers to set rates in a new market targeting millions of small businesses.
NSDL e-governance, which was formed when the National Securities Depository was demerged into two entities, is among 34 shortlisted GST service providers, also known as GST Suvidha Providers (GSPs), including EY, Tally and Deloitte.
It recently launched a national GST returns filing website to offer services as an application service provider (ASP) as well. While a GSP can directly connect to the application programming interface (API) of the GST Network (GSTN), the nodal agency in charge of the technological infrastructure for GST filings, an ASP can offer value-added services and route filings through a GSP.
"We have kept pricing competitive for SMEs, which are said to be about 80% of the total taxpayers under GST. We are going to give an inclusive price of Rs 2,700 per annum for businesses that have up to 9,000 invoices, which will be about 30 paise per invoice," Rai said. For businesses with more than 9,000 invoices, NSDL is expected to charge 40 paise plus taxes on each invoice.
Several other GSPs ET reached out to did not want to disclose their pricing details citing business reasons and market competition. "Our pricing has been finalised, but currently the pricing in the market is still being kept under wraps for standard business confidentiality reasons. We have decided on a simplistic model to ensure not only competitiveness but also fair pricing to every type of taxpayer," said Saket Agarwal, global CEO at Spice Digital, a GSP.
Tax-filing website ClearTax, which has launched its GST software services for SMEs, chartered accountants and large enterprises as an ASP, said its pricing will begin at Rs 100 a month for SMEs, going up to Rs 5,000 a year based on customised features. It will also offer its software service to large enterprises starting from Rs 2 lakh and going up to Rs 50 lakh, CEO Archit Gupta said, adding that its GST products will be free till September.
ClearTax has also applied to become a GSP.
GSPs and ASPs say pricing will vary on the basis of the services they offer, and that a single pricing model would emerge gradually. "We expect the pricing formula to be on similar lines for almost every one in the market except for the outliers. We believe that eventually the market will move towards a single pricing model with the variations being on the basis of features and quality of service being offered to the clientele and partners," Agarwal said.
Services and quality, more than pricing, will determine market share, Rai said.
"Our pricing is already low. Those who offer a bouquet of services will be in demand. Even if someone charges 20 paise for one invoice, it doesn't affect us since the quality of service will rule the roost. We have an edge over others since we are also an e-sign service provider, which means that we are offering a complete solution through our portal, allowing the taxpayer to sign returns, and also have offline facilitation centres," Rai said.
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NSDL e-governance will charge Rs 2,700 a year for returns that businesses are expected to file monthly under the new system, chief executive Gagan Rai told ET. "We are focusing on small and medium enterprises (SMEs) and have priced our offering accordingly," he said.NSDL e-governance, which was formed when the National Securities Depository was demerged into two entities, is among 34 shortlisted GST service providers, also known as GST Suvidha Providers (GSPs), including EY, Tally and Deloitte.
It recently launched a national GST returns filing website to offer services as an application service provider (ASP) as well. While a GSP can directly connect to the application programming interface (API) of the GST Network (GSTN), the nodal agency in charge of the technological infrastructure for GST filings, an ASP can offer value-added services and route filings through a GSP.
"We have kept pricing competitive for SMEs, which are said to be about 80% of the total taxpayers under GST. We are going to give an inclusive price of Rs 2,700 per annum for businesses that have up to 9,000 invoices, which will be about 30 paise per invoice," Rai said. For businesses with more than 9,000 invoices, NSDL is expected to charge 40 paise plus taxes on each invoice.
Several other GSPs ET reached out to did not want to disclose their pricing details citing business reasons and market competition. "Our pricing has been finalised, but currently the pricing in the market is still being kept under wraps for standard business confidentiality reasons. We have decided on a simplistic model to ensure not only competitiveness but also fair pricing to every type of taxpayer," said Saket Agarwal, global CEO at Spice Digital, a GSP.
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Tax-filing website ClearTax, which has launched its GST software services for SMEs, chartered accountants and large enterprises as an ASP, said its pricing will begin at Rs 100 a month for SMEs, going up to Rs 5,000 a year based on customised features. It will also offer its software service to large enterprises starting from Rs 2 lakh and going up to Rs 50 lakh, CEO Archit Gupta said, adding that its GST products will be free till September.
ClearTax has also applied to become a GSP.
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GSPs and ASPs say pricing will vary on the basis of the services they offer, and that a single pricing model would emerge gradually. "We expect the pricing formula to be on similar lines for almost every one in the market except for the outliers. We believe that eventually the market will move towards a single pricing model with the variations being on the basis of features and quality of service being offered to the clientele and partners," Agarwal said.
Services and quality, more than pricing, will determine market share, Rai said.
"Our pricing is already low. Those who offer a bouquet of services will be in demand. Even if someone charges 20 paise for one invoice, it doesn't affect us since the quality of service will rule the roost. We have an edge over others since we are also an e-sign service provider, which means that we are offering a complete solution through our portal, allowing the taxpayer to sign returns, and also have offline facilitation centres," Rai said.