A great amount of SME accounting time is spent entering banking transactions into accounting software and then categorizing them according to their nature whether it be revenue or expense. Automatic bank feeds can save an enormous amount of time on data entry and increase the accuracy and speed of doing business by keeping the accounts up to date. So it is worth to set up bank feeds to increase efficiency and cut down data entry? Yes – provided that your financial institution can generate the bank feed and your accounting software can accept it. Direct feeds ensure the small businesses are working with accurate data.
Xero, a popular online accounting software with over 1.8million users, has created a powerful feature from its API to connect banks and financial services organisations securely for facilitating bank transactions into its software. Another added advantage when connecting to the bank feeds automatically, is that the businesses can obtain up-to-date view of their cash position in Xero without having to log into the bank system. This greater visibility of the clients’ cash position helps accountants to provide timely oversight of their finances.
Over 130 financial institutions offer direct feeds to Xero today and the Xero Bank Feeds API will continue to grow in the region. In Hong Kong, HSBC and DBS implemented the bank feed integration in 2017 to connect their customers to Xero. Once the bank feed has been setup, there are further ways to enhance the efficiency when performing bank reconciliations by creating bank rules. It removes the effort to key in the same data over and over again. Each rule you set up will have at least one condition, but may have more if desired. A rule can be set up to meet any of the conditions you set, or all of them.
In simple terms, the rule provides “if…then” basis and setting up the conditions to be met. Xero will find any transactions matching the rule’s conditions and suggest a match. All is needed to do then is click ‘OK’ to reconcile it. Xero allows the ease of creating separate rules for bank fees, loan repayments, interest, payment of salary, or all kinds of expenses that incurs on a day-to-day basis. If a transaction that Xero suggests based on the rule isn’t quite right, it is easy to edit to create a new one or to find a transaction you’ve already entered into Xero to match with the bank statement line.
Please feel free to contact the FastLane team at [email protected] to discuss your needs to setup Xero and bank feed connection.
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