ASK any small business owner what they dislike about the finance side of their business, and tedious admin and lack of flexibility from their bank will come close to the top.
Open Banking offers an instant solution, but according to a new report, more than a third of small and medium-sized businesses (SMBs) are still unaware of the scheme’s existence two years after the government launched it.
Small businesses are the backbone of the UK economy, generating nearly half of the country’s annual turnover and providing nearly half of its jobs, but they often lag behind when it comes to digital tech.
Designed to bring more competition and innovation to financial services, Open Banking is a secure digital scheme that gives third-party providers secure access to your financial data if you choose to share it.
It means business owners can access safe, secure and regulated mobile apps and online websites offering new financial products and services like payments, loans and instant cashflow oversight. There’s an entire financial wardrobe of products available that you can tailor to your business.
It’s all designed to help SMBs get a better deal, make life easier and provide a more detailed understanding of their data.
“The Open Banking Revolution: Invisible, Customer-First, Feel Good”, commissioned by financial management software provider Intuit QuickBooks, also highlights how Open Banking will reduce the need to switch banks in order to access new products.
It reveals almost a third (32 per cent) of SMBs describe poor finance options as holding their business back from growing. Many stay with their old bank fearing lost payments or other accounting errors during a switch. Open Banking means all third-party products are available regardless of who you bank with.
QuickBooks speeds up bookkeeping with a whole suite of features covering areas like invoicing, payroll, estimates, employee time tracking, sales tax and inventory tracking.
Using Open Banking, small businesses can also easily integrate years of bank transactions for richer insights, from overview dashboards to detailed reports.
New functions like the QuickBooks 90-day Cash Flow Planner means business owners can benefit from rich, accurate and historic transaction data to provide improved benefits and insights to customers.
Meanwhile other finance apps on the market offer things like fast access to business loans which should also result in more competitive loan rates.
“This report looks at the opportunities Open Banking and its associated technologies can bring to small businesses,” says Chris Evans, vice-president and UK Country Manager at Intuit QuickBooks, “The Open Banking revolution will empower small business owners that want to do things differently and embrace new and better ways of working. It paints a picture of a future where financial services and small businesses work hand in hand to drive business success. This is something we at Intuit QuickBooks passionately believe in and work towards every day.
“As the full extent of Open Banking capabilities materialise, those that want to power their productivity will build personalised suites of financial services that suit their individual needs and supercharge their competitiveness in market.”
Open Banking means open for business.