Open banking: What's behind the latest NatWest integrations?

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NatWest has taken two further steps towards building its integrated banking and accounting system. 

Earlier this year, the bank announced a partnership with FreeAgent that allows small businesses to track their finances and report their taxes digitally. Now it has deepened that relationship significantly by enabling small business customers to sign-up using their existing business banking login details.

“It’s the integrated digital consent, that’s a big part of open banking,” explained Ed Molyneux, founder of FreeAgent. “So rather than having to use your online banking credentials or paper forms, there’s now a seamless, completely online journey just as if you’re authorising an API online like we do all the time.”

Molyneux envisions a post-open banking world, where the lines between accounting software and banking are blurred. Crucially, he said, this won’t be achieved by just building a user experience on top of the bank’s data.

“That suggests there’s a separation between the two things and the banks are just a box to hold money in. But open banking is an opportunity to integrate the data and the user experience together.”

That’s where NatWest’s other announcement this week comes in: the bank is partnering with Sensibill, a Canadian digital receipt management service. NatWest customers will be able to access Sensibill through its mobile banking app.

The new service, which will be available for free for small business customers in early 2018, will enable receipts to be captured using a smartphone camera or sent to the app via email, and reconciled with a list of transactions held by the business.

“The integration lives inside the mobile banking experience for now,” Molyneux said. “That’s step one. The next step is the sharing of that data alongside transaction data.”

These innovations are of course being driven by the buzzword du jour: open banking. But Molyneux also pointed toward another motivation behind the big banks’ newfound cooperative ethos: MTD.

“A lot of these conversations are driven by MTD,” he explained. “HMRC is still proceeding at full speed. Even though the official line is no sooner than 2020. The banks perceive that are looking to get ahead of the game. They want to offer solutions to their customers.

“And, actually, April 2019 isn’t that far off for VAT paying clients.”

About Francois Badenhorst

I'm AccountingWEB's business editor. Feel free to get in touch with comments, tips, scoops or irreverent banter. 

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By chatman
26th Oct 2017 11:27

Is this bank feeds? I must say the NatWest-Xero bank feed is rubbish, the worst of all the Xero bank feeds, so I hope this one is better.

The receipt scanning and matching sounds good. It sounds like what Receipt Bank and Auto Entry do, but only from a phone app, which is only really good for very few invoices.

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26th Oct 2017 11:46

I have to confess it's got me a little confused about how all this fits together.

Bank and FreeAgent I get -sounds good.
Not sure how the Sensibill element fits in..Is it reconciling in FreeAgent? Surely not the bank itself?

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By chatman
to rsergeant
26th Oct 2017 11:52

Presumably Free Agent suggests that a payment be matched with an invoice, in the same way that Xero does it with invoices imported from Auto Entry or Receipt Bank.

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26th Oct 2017 12:29

Watch it all fall apart when the hackers get going, especially when the banks deny responsibility. Too much too soon.

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By chatman
to johnjenkins
26th Oct 2017 12:39

But is it any more than Xero is already doing? The interface just pushes transactions to Xero; there is nothing going the other way.

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27th Oct 2017 21:32

Just think of all that lovely granular de-anonymised data NatWest will get !

I wonder how it will feed into the loan application (and more importantly, rate-setting) process. Could it help them identify assets to acquire in the way RBS's now discredited business recovery unit did ? Which marketing agencies and other third parties will NatWest sell the data to ?

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