ClearTax: Unsolved Mystery of Invoice Registration Number
A UX case study to activate users by generating at least one Invoice Registration numbers
During the summers, I worked as a Product Design Intern at Cleartax in Bengaluru for approximately n weeks, working with one of the most diverse design teams I could have imagined. During my internship, I worked on multiple projects, including e-invoice generation, Invoice Discounting, Invoice Financing and Data Overview of GSTR filing.
Note: This overall case study requires some pre-requisite knowledge of how taxation and GST work for B2B businesses. I have taken a small example to start explaining its basics.
Introduction
Clear, being a SaaS provides end-to-end solutions for tax filing for companies. One very important aspect of GST filing is the IRN (Invoice Registration Number) generation, which is 64 a digit, GST portal-generated number to be attached to every B2B invoice by businesses with yearly revenue greater than 20 cr.
Clear e-Invoicing is a platform that allows businesses to generate an e-invoice using a NIC account (the same government organisation that maintains our Aadhar card database but here acting as an IRP, i.e. Invoice Registration Provider)
Note: The whole process is valid for B2B invoices e.g. A (raw material provider) sold some goods to B (manufacturer), then A must generated IRN with the invoice given to B.
The Basics
Before moving forward with so many terms like IRN, IRP, GSTR 1, Invoice, e-invoice, NIC and Abracadabra, Let’s learn about the process from a business’s perspective to understand how GST works for them.
Every month, business owners have to fill out the following:
- GSTR 1 | Sales Register (Have to upload sales invoices with IRN)
- GSTR 2A | Purchase register (Fills automatically from supplier’s GSTR 1)
- GSTR 3B | Overall Summary (Comprises of overall summary)
Who pays how much GST in the end?
>> The whole GST is paid by the consumer (₹216 = ₹108 + ₹72 + ₹36) and other stakeholders do not pay any GST at all.
Who has to generate IRN?
>> IRN is mandatory for B2B transaction (with turnover > 20cr).
So what if B does not generate IRN?
>> B will be considered as the consumer in the whole supply chain and will not get a ₹108 claim from the government.
What are the steps included in generating an IRN for the first time?
>> Register on an Invoice Registration Provider (IRP), Set up an additional IRP API account >> Upload your invoices >> Generate IRN
Problem Statement
The Indian government recently announced that the vendors with a turnover > 10 Cr must generate an IRN for every B2B transaction invoice.
However, with new rules in action, the government has authorised Clear to generate IRNs using Clear IRP, which would be equivalent to NIC in the invoice generation function.
However, the activation rate (number of users successfully generating at least one IRN) have went down because previosly when business with revenue >50 cr were aided by customer support team which we can not provide for business with revenue > 5cr. You are required to redesign the overall flow of a user on Clear e-Invoicing to increase activation rate.
Understanding the stakeholders🪸
Existing Clear e-Invoicing Flow
With the help of the product team, I got the opportunity to look into the Customer support recordings, helping businesses set up their business on Clear e-Invoicing and generate their first invoice.
Let’s examine the customer journey when they first come to Clear e-Invoicing with the help of a storyboard.
Inferences from the flow:
- Bifurcation is required at different steps of “Setup Business”
- IRN being new to them, users are not aware of what is NIC, NIC API or why they even need NIC as IRP (Invoice Registration Provider)
- Incorporating Clear as IRP will make the flow more tedious.
Metrics to solve
- Increase the activation rate: Increase the number of users able to generate IRN successfully without the help of customer support.
- Increase Clear IRP users: With Clear getting authorization as Clear IRP (Invoice Registration Flow) along with NIC IRP, we wanted to increase people opting for Clear IRP over NIC IRP because it is fast, with no restriction API calls and helps us to hold more user data which would help us to optimise user experience in future.
Clear IRP vs NIC IRP
Both of them are almost similar, where the first step comprises creating an IRP account, and the second step is setting up the respective IRP’s API.
However, there is one major problem lies with the e-Way bill (document to be generated for transportation of goods with a value of ₹50000 from one place to another). Currently, due to limitations from government policies, if IRN is generated via Clear IRP, the businesses associated with the transfer of any goods cannot generate an e-Way bill. If a business wants to generate IRN for sales and also wants to transport that good (hence, it will require an e-Way bill), it has to generate it via NIC IRP not by Clear IRP.
User flow
The overall activation flow comprised of 4 major components:
1. Business setup using NIC/Clear IRP
- Promote Clear IRP
- Government mandate to give NIC IRP option
- Clear IRP is not possible if the user also has an e-way bill requirement
2. Free Trial
- Currently, it doesn’t include what exactly Clear is offering compared to free service at the government portal
- Invoice Excel to be uploaded comprises 100+ fields for each invoice, and successfully uploading it without any error takes days; hence, the free trial is started, but users are technically unable to use the product
3. Ingestion (Invoice upload)
- It is an extremely tedious process, and since it is used in other products like GST filing, Max ITC, etc, Clear has been trying to simplify the process by autocorrecting and creating a more user-friendly interface
- Allows the user to create their template or use a government template
- Low success rate
- It also handles the possible issues that can come during IRN generation
4. Invoice selection and IRN generation
- 1 click process
- High success rate if the document has been ingested successfully
In discussion with the product team, we decided to go with an approach where we wanted to try out 2 flows;
Flow 1
Incorporate only flow changes in a 3-day sprint in such a way that lets users navigate through the product just by signing up for Clear and ask them to setup business only when they have successfully uploaded/ingested the invoices
Did it work? NO!
Not just it didn’t work for the users without customer support because ultimately, it didn’t solve the above-mentioned problems, as users had to setup business at some point but also affected users activated by customer support because even CSMs weren’t puzzled due to new flow and had to be educated first which didn’t had any positive ROI.
Flow 2
Keep the flow nearly the same along with incorporating Clear IRP (except for the free trial to be unlocked after successful ingestion of invoice document), but revamp the UI to educate the user along the journey
Creating a Sustainable UI
1. Progress Stepper
2. Information Section
Overall Interface
Impact✌️
Activation Rate: There was a 14% increase in number of users able to generate IRN successfully
Clear IRP Registration: Monthly IRP registration moved from 102 avg users to 246 avg users
Inference: The signup first flow worked in favour of increasing Clear IRP users; However, the activation rate was still found to be low, where the highest drop was noted under ingestion.
