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Open banking: The slow burn continues

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New research from AccountingWEB has found that almost half of accounting professionals believe they do not use open banking tools. Those who do report finding efficiencies in a diverse range of areas, including bookkeeping and payments and tax reporting.

5th Oct 2022
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AccountingWEB’s latest Insights research found that 48% of respondents said they did not use software based on open banking technology, while a further third accessed open banking data via their main accounting platform.

More than 500 accounting professionals across the UK took part in the research, which took place between May and July 2022. 

The findings tally with research conducted by AccountingWEB and iwoca earlier this year, which found that 34% of accountancy firms still aren’t using open banking. The report also suggests that if accountants don’t use it, their clients won’t either.

The survey’s final question brought a more positive development for proponents of the initiative, with those labelling themselves 'early adopter small firms' stating that in two years’ time, they expect almost three-quarters of clients to be supported heavily by open banking technology. Medium-sized firms also expect greater proportions of their client base to be using open banking technology.

Commenting on the findings Julian Green, AccountingWEB's head of insight, said that on the face of it, the findings demonstrate how far vendors using open banking technology have still to go in terms of demonstrating the efficiencies their solutions offer. "However, the fact that early adopters are so far ahead of their peers in the take-up and that so many accountants are sleepwalking their way into solutions using open banking technology offers some degree of encouragement," he added. "This study draws a line in the sand and it will be fascinating to measure how the landscape shifts and develops over time."

Open banking value

AccountingWEB’s recent Insights research asked participants which aspects of open banking could add the most value for accounting professionals.

Reconciling transactions, streamlining bookkeeping services and facilitating tax and Making Tax Digital (MTD) reporting came out on top with the majority of respondents, while more niche activities such as using open banking to access finance, model and forecast financial figures, and validate data for tasks such as audit sampling or anti-money laundering purposes scored lowest on the list. 

In perhaps the least surprising aspect of the survey, small firms or businesses that self-selected as early adopters of technology were the heaviest users of open banking technology, citing efficiencies gained in a wide range of activities and using a diverse range of tools such as Wise, Crezco, Armalytix, Modulr and Circit.

At the other end of the adoption cycle, a whopping three-quarters of “status quo” firms did not use open banking technology at all.

Accounting professionals working in practice tended to value open banking functionality higher than those in industry, with faster payments and credit control the only tasks valued higher by industry accountants.

Since its launch in 2018, progress on the open banking initiative has been a slow burn, bringing steady rather than spectacular efficiency gains to the accounting profession. While its backers point to the ability to better automate routine tasks and the increased security of open banking feeds, finance professionals have also flagged concerns around connectivity and reliability.

Accountants have also highlighted the FCA’s requirement to have clients reauthenticate access to their bank feeds every 90 days as a major stumbling block for the initiative, although a recent relaxation to the rules offers hope that more efficiency is on the way.

Add your voice to our study and you’ll receive all the insights from this research, our latest State of the Nation Accounting Software report and the chance to win a £500 Amazon voucher. Take the survey today.

Replies (5)

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By Winnie Wiggleroom
06th Oct 2022 07:05

"At the other end of the adoption cycle, a whopping three-quarters of “status quo” firms did not use open banking technology at all."

giddy up and giddy up and get away

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Replying to Winnie Wiggleroom:
Tom Herbert
By Tom Herbert
06th Oct 2022 08:25

Whatever you want, Winnie :-)

Poison and Quo in the tech coverage this week - who knows which band may feature next time... Air Supply? Whitesnake? Motley Crue?

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Replying to TomHerbert:
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By lh3f9764bg1g
06th Oct 2022 12:04

The sooner this MTD lark is going Down the Dustpipe the better it'll be for everybody (except the software vendors of course).

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Replying to TomHerbert:
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By Hugo Fair
06th Oct 2022 12:37

Status Quo were better at forecasting than politicians/economists ... judging by the progression of their singles prior to their first hit:
* "I (Who Have Nothing)"
* "(We Ain't Got) Nothin' Yet"
* "Almost but Not Quite There"

And they changed band name twice during that period ... so re-branding can work!

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Replying to Hugo Fair:
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By lh3f9764bg1g
07th Oct 2022 13:08

They'll always be the Quo to me!

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