Fintech: The apps your clients will be using in the near future

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Fintech fanatic Bobby Chadha reveals how Facebook, bitcoin, business banking and more will disrupt the traditional relationships accountants have with their clients.  

After speaking to a few accountants recently, I was asked my opinion on how tech is changing and the impact on our clients and us as their accountants.

I thought I’d share some of the changes that are coming our way and I’ve added my own thoughts as an accountant.

Facebook: How we Bank in the future

Facebook wants financial data such as transactional and cards info from banks, but why?

Well, Facebook wants their users to carry out banking tasks via FB messenger. Actions such as checking their bank balance, alerts to problems and potentially even transferring money to other registered users are what Facebook wants to do.

Now we all remember the recent problem Facebook has had with privacy and its tendency to sell user data to third parties. This is something we all should consider before authorising our data for use with these types of platforms.

This could be possibly the way we and our clients bank in the future. On average 1.47 billion people log in daily to their Facebook account, so it makes sense in a weird way that you consume all other key services from that one platform.

Do you accept card? Yes and Bitcoin

What is Bitcoin? Bitcoin is a form of currency and an accounting headache which aims to create a financial system of sorts but without the traditional ‘controlling’ systems like banks, state banks etc.

Bitcoin transactions are masked and are not tied to any one institution. This is a good thing as it becomes easier to trade globally with one value vs the headache of fees and fluctuating foreign exchange accounting swings to deal with.

Okay - so what’s the impact on our clients? There are some startups who accept bitcoin as a payment method. I recently visited a coffee shop which accepted bitcoin (but didn’t see anyone actually paying for their cuppa with bitcoin).

Another point regarding accepting bitcoin as payment is the fluctuation on bitcoin prices. It’s very volatile and changes by the hour. Once cryptocurrency becomes widely accepted at scale and becomes less volatile, I believe businesses of all sizes will support this payment method (good luck with the accounting!).  

Starling and Tide: Business banking becomes free and all in one

Businesses have never had it better when it comes to ‘banking’. Starling has free business accounts, which are fee-free (no more switching every 12 months for free banking and a parker pen), and it’s developed mobile-first.

Tide is focused on the small business vertical with features such as income/expense categorisations, invoicing and in the near future, MTD capability for filing and other accounting features.

What I find interesting is how the traditional relationships we accountants have with bank managers might change. Currently, we refer clients to banks for borrowing, fund transfers, lease loans etc. But with banks now becoming app only, will this mutually beneficial relationship cease to exist?

Same goes for other services we refer our clients on to; for example, mortgages, insurances and IFA’s.

Platforms such as Habito.com, where they act as an online mortgage broker are growing rapidly and are genuinely saving people money and time. But do they know their lenders so well that they can help me match my client’s financial circumstances to a lender who is willing to lend at a reasonable rate?

Google for sending money

“OK Google, pay my £400 towards my credit card.”

Google is working on its mobile payment platform and wants us to use their service to pay our contacts. You can also ask Google to request money from contacts.

Imagine chasing invoices through Google assistant in the future. Google’s voice and payment services will be embedded across all their services from Gmail to its Gsuite apps but with the growing popularity of voice command interactions, we can expect our clients to be carrying out their banking by simply commanding it.

MaxTax and Taxfix: How people complete simple tax returns

HMRC has made the term ‘taxes’ one of the hot topics of 2017 and it’s set to continue in 2018.

Through their development of MTD (sorry, I said the ‘M’ word) HMRC is wanting developers to help make taxes simpler to do, whilst hoping to save money on their own infrastructure costs (good luck with that).

This development has led to a number of apps taking advantage of the idea that taxes should become simpler to do.

TaxFix in Germany recently closed a £13m series A round which allows German taxpayers to file simple returns through their app.

Closer to home, apps like MaxTax.io (my own plug) which uses a smart ‘bot’ through Facebook messenger and is backed by an accounting firm (because you can’t replace good tax experience...just yet) and others, are leading the charge on making the process of a tax return self-served and cheaper to do.

Need a loan? Just connect to your accounting software

KYC checks, trading accounts, multiple HMRC documents and a dollop of begging the business managers was how we typically borrowed for small businesses.

The typical way of borrowing will soon become connecting to a platform such as Funding Options in order to get a loan from iwoca or Zopa and your accounting platform like Xero or even your bank (thanks to open banking).

Oh and the way we approach our health issues will change.

Babylon health app: our new GP

Babylon health which also powers the NHS ‘GP on hand’ app is an AI-powered app which looks to assist and possibly replace doctors in the future.

It’s a simple app which asks you questions about your symptoms and it then recommends next steps and what symptoms you should look out for.

GP on Hand’ is a simple Face-Time-type app which allows people to connect with GP’s at a click of a button.

What other apps/tech not listed above have you or your clients utilised?

About Bobby Chadha

Bobby Chadha

Product Innovation at Deloitte

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16th Aug 2018 11:01

Having spent most of last night trying and failing to persuade my mainstream cloud based accounting software to recognise bank transactions where payee and amounts obviously match transactions I've already input but where it seemed to throw a hissy fit, I'm sceptical. Having said that, Applepay seems to be a convenient mechanism and no doubt other FAANGs participants are going to need to expand into this market. This is clearly going to develop, probably in unexpected ways, but having watched the banks in the 1980s try and fail to supplant the need for bookkeeping, and with the aforementioned frustrations demonstrating that the software companies don't really understand transactions very well, it may take some time and provide accountants with a good deal of work. Finally, my journey into cloud accounting makes me wonder about the training of firms' staff if they are really going to be effective in implementing cloud based systems for clients.

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to Nigel Hughes
17th Aug 2018 11:17

Helpful person on their online chat service solved the bank matching problem, for which I'm truly grateful, but it wasn't quite as straightforward as I thought it might be. We don't seem to have arrived at the "the system will do it all for you" utopian state we've been led to expect, just yet.

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16th Aug 2018 11:05

I think automated marketing linked to financial predictions from services like Xero and CRM's are coming and will make a big difference.

For example a restaurant detects a drop in forward bookings in its reservation software like Yelp Reservations or simpleERB and the software creates offers that are automatically sent to the database. Paid for campaigns on channels like Facebook, Google and Twitter are recommended and optimised.

Independent retailers could do the same thing with loyalty services like Swipii linked to POS's like EposNow.

The common factor is that the marketing actions are automatic with no input needed from the merchant.

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16th Aug 2018 11:06

All interesting stuff Bobby but how much of this will become the 'norm'?

I don't just mean for the tech savvy but the average client who uses tech but their life doesn't revolve around it (i.e. they don't check their smart phone every 12 minutes).

Will much change in the next say 2 years? Yes challenger banks are here and lending platforms are being used by an increasing number of accountants, but bitcoin being used to pay accountancy fees?

I don't think so.

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to Mark Telford
16th Aug 2018 12:00

Hi Mark,

The head of Google Local famously said a few years back, "If it takes a small merchant more than 15 minutes to do it won't get done", speaking in frustration about the lack of uptake of his free services.

Now Google is automatically populating the Knowledge Panel, (the square box that comes up in Google serches) effectively building a web presence for merchants and restaurants with no input from them.

The new Adwords optimises campaigns for merchants with no input.

The next step, and it is one that companies I am involved with, Swipii and simpleERB, are taking, is linking the visit/spend data and projections, with automatic marketing actions .

The merchant or restaurant gets optimised actions that do not need thought or input.

There is a whole market for advisory services around this and I think accountants are ideally placed to do this. But only those with technical and marketing nous will be able to do so.

(Anybody interested can pm me :-) )

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to Mark Telford
18th Aug 2018 12:12

Hi Mark, Thats the million dollar question, what will become the norm. It is however interesting how we're accepting of app only banks, paying for stuff by touching our apple watch and driverless cars (60% of U.S orders for the Tesla model 3 have paid for the additional automated driving upgrade) so is it really a stretch to think people may pay us in an alternative form of currency? may not be bitcoin but another form could actually happen. Let's see how this evolves :)

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By Robbo
16th Aug 2018 11:14

I think most of this is pie in the sky, I'm surprised that somebody who works for the big 4 is talking about things that will be adopted by small clients rather than big. My first advice re the FB plugs is at your own peril.
Of course there are the unknown unknowns that nobody can see till they arrive.

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By Dandan
to Robbo
16th Aug 2018 13:02

Astute comment.

A lot of apps are appearing all other the place; enticing small business users with promises of MTD compliance. But these have basic features for small businesses .

A large business that requires sophisticated costings , stock control and management analysis does not use the commonly available online accounting software. Neither does it use an app on a mobile phone which snaps at receipts and connects to FB, etc

Yes, small enterprises may go in the direction suggested by the article . They do not need any sophistication in they accounting systems to monitor their trade.

Sadly most online accounting software are moving away from providing features that enable you to properly measure and monitor business data. Instead they are focussing on gimmicks and trying to make the software a one-stop shop for everything .

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to Dandan
18th Aug 2018 12:40

I find it interesting that the system I'm using doesn't include a snapshot of accounts payable and receivable on the dashboard, but shows me a graph of monthly billings - which is fine, but not as useful as knowing who I need to pay and who I need to chase. Actually I think the dashboard should allow for a degree of customisation.

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By hfc1875
16th Aug 2018 14:20

Agree with dando and robbo - the new app kids on the block want to attract the fintech generation who've grown up with a smart phone (and hook them in further to it!) - rather than the "pc generation" which used "proper" accounting packages on their pc....and still do!!. The apps sell themselves as an "all answers" solution to the current client accounting/business requirements, but by their nature will be limited in what they can provide as "end game" financial information - apart from the requirements of the very small business. An old adage adopted - an app is only as good as the user - just the same as it was for the "pc generation"! Cant see this in wholesale use any time soon.

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16th Aug 2018 21:41

I think the "negative" comments here are all ignoring the contribution that AI will make.

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20th Aug 2018 10:27

Ten years ago how many of us thought our lives would revolve around smartphones?

Sure, not every small business has (yet) embraced all the available apps that will make their lives simpler, but the 'direction of travel' is clear.

Some people take longer to adapt than others. And longstanding clients of accountants who are not embracing the transition to a brave new world, MAY be more patient than newer business start-ups.

Of course the first generation AI assistants and all the cloud accounting facilities are not perfect (yet). But I'd bet they will get there within the next couple of years.

In my talks about the future for accountants I recommend planning for 3 future timeframes:
1 - The shortest one - 12-18m (this has long been the focus for many accountants' plans and focus);
2 - 18m-3yrs - With an open mind we can get a sense of what's coming down the line;
3 - 3-5yrs+ - Flexibility is key here as we can only sketch out what could be happening even over this relatively short period. Beyond this it would be foolish to make definitive predictions.

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to bookmarklee
23rd Aug 2018 22:40

Thanks Mark for your thoughts, I agree that tech will evolve and become 'smarter' over time, I have worked on apps which are already crunching sequences faster than a team of 100 people and providing outcomes faster than ever before.

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20th Aug 2018 10:27

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