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FreeAgent and Natwest boost FinTech partnership

19th Jul 2017
Editor in Chief (interim) AccountingWEB
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NatWest and FreeAgent boost fintech partnership
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NatWest and FreeAgent boost fintech partnership

“We want to move from hindsight to foresight”. That, says NatWest’s Haydn Thomas, is the ultimate aim of the banking giant’s partnership with cloud accounting developer FreeAgent.

To recap: under the partnership formed at the beginning of this year, NatWest/RBS will offer FreeAgent to its business customers for free, on the basis that the client shares their accounting data with NatWest through FreeAgent.

“By linking a business’s accounting data to their bank account we can have much more in-depth discussions with our customers about their futures and their business plans,” said Thomas at the bank’s Boost event in Bristol recently (see video below).

“NatWest wants to be proactive – a true relationship bank right across the spectrum,” he continued. “Anything we can plug into those systems that can give us real time data and some accurate forecasts is really helpful.”

This “wraparound care” arrangement is voluntary and will be open to existing FreeAgent customers too.

Accountants will be able to join the NatWest/FreeAgent “advisory eco-system” by paying a £3.00 monthly subscription per client, according to FreeAgent chief commercial officer Kevin McCallum.

For FreeAgent the partnership will deliver a much-needed surge to its user numbers, but managing director Ed Molyneux explained that the deal was important to position the company within the rapidly expanding “fintech” [financial technology] universe.

“It’s very interesting to sit in the middle of this ecosystem with banks on one side and accountants on other. Bringing them together is something we’re interested in doing,” Molyneux said.

For a bank seeking to repair its reputation with small businesses, the link with accounting software is a sensible defensive move. As lending relationships between small businesses and big banks cooled following the financial crisis, the alternative finance scene has boomed. Cloud systems that can pass financial data and facilitate online risk assessments are a key part of the fintech formula.

“One of the barriers banks face when they think about lending to small businesses is data on those businesses. It’s very hard to get accurate data without having some kind of real time accounting system in place,” Molyneux said of the NatWest deal.

The timing of the partnership is important too, according to Kevin McCallum. From May next year, Europe will require banks to make their account data accessible via open banking application programming interfaces (APIs). The FreeAgent-NatWest tie up will be based on direct integration, available before the turn of the year, and will be a precursor of what will happen between banks and online accounting systems over the next two years.

“Data from the bank flows to FreeAgent, and flows back,” McCallum said. “Much tighter integration equals a better experience for customers.” The option to let the bank see live accounting data will be included in the package as a means to enable swifter finance or cashflow help if it is needed. Among test users, this feature was not encountering too much resistance, McCallum said. “They can see the advantages.”

While offering hints of what is to come, Thomas would not be drawn on the full details of its NatWest’s integrated finance offerings, but vowed that the resulting simplification of the bank-small business relationship will allow “accountants to be accountants”, freeing them to focus on advisory services.  

Replies (8)

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Adrian Pearson
By Adrian Pearson
19th Jul 2017 14:46

Hi John, can you please expand on what this means please: "Accountants will be able to join the NatWest/FreeAgent “advisory eco-system” by paying a £3.00 monthly subscription per client."

Surely this is the sentence that is likely to be of most interest to your site's audience?

FreeAgent is free to the small business (via Nat West). Why are accountants picking up a £3 tab here?

Thanks (1)
Replying to Adrian Pearson:
By killer33
20th Jul 2017 15:32

You pay £3 per month to have the client added to your FreeAgent Practice dashboard.

It makes no sense to me either, and for these clients I just login via the client's portal as 'The accountant'. Cost £0.

Thanks (1)
By danielgricks
19th Jul 2017 15:26

We already have some of our clients using FreeAgent.
As with any software it needs hand holding and support.
Which we provide to our clients, some needing more than others.
Are NatWest/RBS going to do this?
It will be a lot cheaper for us and if the banks are effectively picking up the bookkeeping support, it could be a good thing.

Thanks (0)
By ireallyshouldknowthisbut
19th Jul 2017 16:01


This is the last thing I would want to do, if your client has stuffed up their bookkeeping it will set off alerts bank side and they will be jumping through expensive hoops before you can say "blimey enforced factoring is expensive"

I always recommend clients keep their loans and transnational banking apart, the less the banks can see the better.

This must be all about risk assessments for the bank and trying to get out if they perceive a risk. Exactly the opposite of what is good for your client, what they want is to get through a bad patch before the bank notices and withdraws funding / ramps up their fees.

Thanks (1)
Replying to ireallyshouldknowthisbut:
By danielgricks
19th Jul 2017 19:33

You are probably right IRSKTB.
Luckily most of my clients take my advice not to borrow and to keep away from the likes of RBS/NatWest.
But I am sure a few will be caught by these salesmen.

Thanks (0)
By coops456
20th Jul 2017 16:46

I'm the treasurer of a sports association which is a NatWest customer. Can't see a downside for us; free accounting software and presumably integration to automate transaction downloads from the bank statement. Sounds pretty good to me.

Thanks (0)
Replying to coops456:
By danielgricks
21st Jul 2017 09:22

Probably in your case coops it will work because you know what you are doing. Many small business clients will not be as IT/Accounting savvy and will expect their accountant to sort the mess.

Thanks (0)
By Glenn Martin
26th Jul 2017 07:59

So new contractor start up client comes to me, I form his company and get him to open an account with NatWest instead of another high street bank.

NatWest give him Freeagent for free saving me £300 as I would normally pick up tab for the software.

Am I missing something?

Thanks (2)