How to save time on your accounting with bank feeds
Discover how using bank feeds can help you to save time and increase accuracy when it comes to managing your business finances.
Bank feeds are great for keeping a hold of your business’s cash flow.
You may be running the financials yourself or outsourcing this task to an accountant, so using bank feeds can save you time as well as give you visibility of your business incomings and outgoings.
In a nutshell, bank feeds are designed to help you manage your money – and they’re free.
Here’s what we cover in this article:
- What are bank feeds?
- How do bank feeds help to manage cash flow?
- Are bank feeds easy to set up?
- Final tips to consider
What are bank feeds?
A bank feed is a secure connection between a business owner’s bank account and accounting product, which enables you to match your transactions for full visibility.
Bank feeds allow transactions to be imported from your bank account so they can be linked to a payment or receipt already entered into the product.
Why is this important?
In a June 2022 report into small businesses by The Open Banking Implementation Entity (OBIE), an overwhelming majority (77%) of respondents said they now have more immediate and accurate insights into their financial position at any given time as a result of using cloud accounting services.
As an extra benefit, of those using cloud accounting services, 59% said they had delivered internal savings and 64% external cost savings.
How do bank feeds help to manage cash flow?
When you’re managing accounting and day-to-day financials, as well as other responsibilities that come with running a business, it can be frustrating and time consuming to do this manually, especially if you’re encountering duplicate information.
Without the beneficial reconciliation function of bank feeds, you’d have to retrieve a list of transactions from your bank records, as well as a list of income and outgoings from business records, run through the bank deposits, withdrawals and expenses on the books in an attempt to match the transactions.
That’s a lot of work, and an important task with no room for inaccuracy.
Using bank feeds can:
- Save time by eliminating the need to manually enter each transaction to reconcile bank statements.
- Increase accuracy through the automatic reconciling process reducing the risk for error.
- Help you gain peace of mind, as they’re easy to use, with only a few steps required to start
- Improve workflows by having everything in one place
- Provide full visibility of the incomings and outgoing of your business
- Free up time that can be spent on other important tasks
- Give confidence knowing that your data is being shared in a secure connection.
In the video below, sole trader Luke Owen talks about how using bank feeds helped his business:
Are bank feeds easy to set up?
Yes, they are.
Firstly, find out if your bank account is supported in your accounting software. In most solutions, you’ll need to search for your bank, follow the instructions to set up and verify the bank account using login credentials.
If you don’t have this, it can be requested from your bank. Note that some feeds will need to be authorised by your bank and this can take three to 10 days to set up.
Bank feeds will usually update on a daily basis. Once your feed has been created, you’ll be able to import your transactions and browse through your debits and credits to match and reconcile your account.
If you’re unable to match a transaction, you can easily create a new transaction manually to complete the process bank.
Or, use bank rules to automatically help you create transactions once they’re imported.
Each rule has a combination of conditions – such as reference, amount, etc – which it will use to recognise the transaction in the future.
If a bank feed isn’t available to you, you may have the option to upload your transactions via file import.
Final tips to consider
Through the ups and downs of running a business, it’ll always be important to keep on top of cash flow – here are a few final recommendations:
- Go for accounting software that provides an automated import of transactions to save time and reduce the time it takes to do your business admin.
- You may be managing the financials yourself or this may be outsourced to your accountant – choose software that easily allows access between both parties for tasks to get done.
- Accounting solutions that capture, automatically categorise, and publish financial documents such as receipts, invoices and bank statements to your accounting software will save time.
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