Dutch bank ABN AMRO is working with invoice management firm InvoiceSharing to launch a ‘touchfree’ automated accounting system for small and medium-sized businesses.
Last summer the banking giant got to work on a pilot programme including an initial batch of 20 businesses with annual revenues of between €2m and €20m to test-run the fintech solution.
According to ABN AMRO the new tool will provide small business owners with 24/7 insight into their accounts so they can estimate working capital needs well in advance and get funding at lower costs.
Its ‘robo accountant’ tool will read and check invoices, generate journal entries and export the invoices to the business accounts. The robot compares invoices with historic data from industry partners, using accountancy data based on the preceding three years.
The two Dutch firms claim the accounting solution will enable companies to process between 10 and 20 times as many invoices every year, and help reduce costs by up to 50%.
Frans Cuppen, general manager for commercial clients south, at ABN AMRO, said: “We want to provide SMEs with extra added value by offering proactive advice and responding to their financing needs. Likely future deficits are signalled well in advance. And by carefully planning invoice payments in alignment with suppliers and customers, we help SMEs optimise their working capital.”
Jeroen Volk, chief executive at InvoiceSharing, added that bookkeeping no longer formed part of the last stage of the administration process. "In due time, we want to help as many entrepreneurs as possible make their business smarter, so they can anticipate and play into future challenges," he said.
AccountingWEB asked Clifton Asset Management, the firm behind the Alternative Business Funding platform, whether this Dutch development signalled a public sector rival to the alternative finance platform, if rolled out to the UK.
Adam Tavener, chairman at Clifton, said the tool was never going to be a genuine unbiased resource for SMEs seeking funding solutions: “This is essentially a simple tech add on to an existing product suite, invoice finance, and doesn’t touch or refer to any of the dozens of other working capital solutions available to SMEs.”
He added that the bank’s target customer base has a minimum turnover of €2m, so would disqualify 95% of UK SMEs.
Tavener also said that while better technology which leads to a better and lower cost customer outcome was always to be welcomed, “in the end it is still a one product solution which may prove difficult to move away from if you decide to change invoice finance provider.”
About Robert Lovell
Business and finance journalist