• Notification Date: 22-01-2025
• Notification No: N/A

MSMEs will be Forced to Have a Greater Transition Time into the New System for Handling Invoices

Before April 1, 2025, when the new Invoice Management System (IMS) is expected to come into play, Indian MSMEs face challenges. According to experts, the transition period is short and key features require improvement although it is believed that the new IMS will boost GST compliance.

This only left small and medium enterprises hand-strung in their attempts to transform their systems, while the government still works at rocket speed trying to fast-track IMS. Advice for the new system was sent out in September 2024, with APIs for IMS integration only available in mid-October. This is putting enormous pressure on the already stretched resources of MSMEs. They had to rush around-update their software and train the staff accordingly.

The system's architecture, apart from the tight deadlines, is an operational hassle in itself. MSMEs really struggle with reconciling large volumes of data manually since there are no bulk-upload tools and offline utilities. Tight timelines for the resolving of discrepancies compound the problem, especially in industries like e-commerce, where disputes are very common.

Experts recommend that the government execute a gradual rollout so that more time is given to businesses to prepare. The technological infrastructure should also be improved by removing portal downtimes and increasing the capabilities of dashboards. Providing financial support for upgrading technology and offering training through workshops would ease the transition process for MSMEs.

The IMS system has the potential to ease GST compliance. However, this will depend on how well the MSMEs are supported through the transition. A more gradual implementation, with targeted assistance, will ensure that small businesses can thrive in a digital economy without facing unnecessary disruptions.