TFS Gulf 
- A Bengaluru startup founder claimed that Zoho Books had recorded ₹3.8 lakh worth of failed transactions as paid.
- Zoho responded, saying the issue likely sat with the startup’s payment gateway.
- Here’s the real question: When the software running your entire finance function goes rogue… who is actually responsible?
So what actually happened?
Azeem Hussain, co-founder of FlexyPe, discovered ₹3.8 lakh in failed transactions all marked ‘paid’ by Zoho Books.
The error only surfaced during a manual internal audit in March 2026, two years into using the platform.
Zoho helped identify the issue. Cashfree publicly confirmed the mistake was on their end.
LinkedIn split immediately:
- Half went after Zoho
- The other half asked why a fintech company ran for two years without basic reconciliation checks
Both sides are missing the point….
Finance stack is growing faster than the guardrails
Beyond players like QuickBooks, NetSuite, and FreshBooks…India now has 2,100+ finance-focused startups.
As per Tracxn (Jan 2026):
- 2,100+ CFO-tech companies
- 325 funded (Zaggle, Vyapar, Clear)
- Investors are pouring millions into these platforms.
And CFOs are adopting these tools “fast” and handing over their entire finance function to software:
- Revenue recognition
- Payments
- GST
- Forecasting and the list goes on and on…
Well, mostly a good thing…
Also read: CA raised $1.62Mn…but it wasn’t easy! Here is how he approached VCs.
But here’s what nobody is saying
Most of these tools have never been stress-tested like a bank’s core system.
Yet CFOs are trusting them with their most critical financial processes, often without building independent controls to catch failures.
The uncomfortable truth? Automation does not transfer accountability.
The CFO is still responsible for:
- Data accuracy
- Financial Controls
- Compliance
Even if the error is 100% due to software.
In India, a minute financial misstatement, even one caused entirely by a software bug, can trigger:
- An auditor qualification
- A GST reconciliation nightmare
- SEBI scrutiny if you are listed
- Board-level questions that have no clean answers
What CFOs should actually do?
The Finance Story spoke to finance professionals who’ve sat on both sides as CFOs and as vendors.
And here is what they have to say:
Get real proof, not sales decks: Talk to actual users. CFO-to-CFO references matter more than demos.
Start with ONE problem: Not your entire finance function. Test one use case → validate → scale.
Fix transaction layer first: Dashboards are useless if the underlying data is broken.
Security & Compliance audit: This is non-negotiable
Check data usage clearly
- ISO certifications.
- Is your data being used for model training?
- If unclear — that’s a red flag.
Ask the hard question upfront
- What is the vendor’s liability when a software error causes a financial misstatement?
- What built-in reconciliation controls does the platform have, and are they on by default?
- How does the platform handle payment gateway failures and where does that data go?
- What is the audit trail, and how far back does it go?
- Has this platform been independently stress-tested at your transaction volume?
Well, there is long-term risk too!
Many of these funded startups will be acquired, pivoted, or shut down in 3–5 years.
As a CFO, your real risk isn’t just “does the product work today,” it’s operational continuity risk.
Your month-end close cannot depend on a company that might run out of runway.
Also read: ‘AI coworker’ for CFOs startup raises $8.7 Mn
Wrapping up…
The finance team must have control mechanisms in place. Otherwise, what looks like a tech failure is really a governance failure.
And let us be honest, today, several CFOs are signing contracts with vendors they met at conference dinners.
Because:
- The founder went to the same B-school
- Someone made an introduction
- The pitch was impressive
That is not due diligence…It is networking dressed up as a business decision.
The finance function is not the place for a favour.
Unlike most industries, a 1% error rate is a product issue. In finance, it is a compliance risk.
