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What does VCFO stand for? The acronym for Virtual Chief Finance Officers is becoming popular as it provides freedom to hire financial roles with redeemable contracts.
A Virtual CFO assists in day-to-day supervision and management of the finance department and helps in capital raising, lending strategies, and implementation.
Many companies are already delegating their operations with increasing roles and opportunities as Virtual CFOs. So they can delight their clientele with niche services.
This blog will cover the roles VCFOs can play to assist your business and if your business needs one.
Why CFO Vs. Virtual CFO?
As every business requirement and needs are different, you can choose to— hire either an in-house Chief Financial Officer or get a remote one on a contract basis.
Usually, small businesses and early startups are prone to hire a Virtual CFO as they can benefit from multiple roles without needing to employ permanent staff. It is more critical for small companies and early startups to have a finance partner right from the inception, not only from tax compliance or accounting perspective but also from a strategic viewpoint.
In small businesses, a Virtual CFO has to wear multiple hats and perform all-around tasks from bookkeeping to strategic financial planning and implementation.
On the other page, the traditional CFO works full-time and closely participates in business operations. However, large companies can still hire Virtual CFO services to support them in projects they cannot work on currently due to a lack of time or experience.
A CFO can now have a shadow team reporting to him that can work on projects ranging from ERP implementations to listing on stock exchanges.
Roles of virtual chief minister of finance
1. Offers all the financial intelligence
The job of a virtual CFO covers a wide range of services—from bookkeeping to general supervision over all financial work, dealing with all aspects of the economic pyramid of needs.
Tasks like pricing management, performance checks, financial analysis, review, budgeting, cash flow management, management information systems- MIS reporting, etc. come under a Virtual CFO’s domain.
So, you can focus on your finance company or business expansion, leaving finance jobs to finance professionals.
2. As strategists — Understand the market opportunities.
For an ever-blooming expanding business, it’s investable to target new spots in the market while exploring further to lock on your following goals.
You need personnel to understand the competitive marketplace to cash on these rare chances and leverage those profitable opportunities better. And that’s your virtual CFO.
You can keep your conversation going with the ease of remote location and thus strategize several functions for your NBFC, such as foreign investment methods and NBFC registration from hire-purchase to MSME.
3. Handles legalities and lowers the tax liabilities
A professional virtual CFO deals with all tax deductions, uncovers money leaks, guarantees business legal compatibility, and fulfills it.
Virtual CFO employs their years of experience and skills to handle transfers and transactions while making your business law-proof.
4. Multiple job handlers and expert assistants
When you hire a Virtual CFO for your lending business or finance company, you are not hiring a single person; you are hiring a team of highly experienced financial experts. That means you will get professional financial services. Besides, this way, you can easily manage multiple financial requirements simultaneously.
This covers:
- Advisory on Lending Portfolio
- MIS Reporting
- Expert Regulatory Advisory
- Drafting
- Updating and Responsive to RBI notifications
Moreover, a Virtual CFO provides the required tools, support, solutions, and system to build your dream business and delight your clients with bespoke financial solutions.
5. Boosts up profit margins and cash flow
With the expertise, a Virtual CFO can easily streamline the back-office task and assist you with better financial control and transparency. With this, you can clearly understand your business requirements and plan accordingly to increase your profit margin.
Strategic management of finances such as bad debts and timely payment of creditors and suppliers— allows business operations such as peer-to-peer lending or NPA settlement to run smoothly without any hurdles.
Conclusion
There are many roles a virtual CFO can perform— as a business owner, you must decide and discuss with the internal team if you need one. Consider the above factors and analysis on the base of them.
We at NBFC Advisory, with 15+ years of experience in advisory and counseling — assist in handling and boosting your Non- Banking Financial Companies with our Virtual CFO Services.
Our team of professionals is a one-stop solution to provide you with real insights and strategic advisory around the trends your business must hop on promptly.
