The spirit of this initiative: a recommendation for banks to authorise third parties to access bank data and initiate payments. It was this set of recommendations that formed the foundation of open banking.
Since then, the open banking ecosystem has evolved considerably. In 2021, open banking will be rolled out worldwide.
Open banking technology offers many advantages for software publishers and end users. This article is aimed specifically at management and accounting software publishers, describing the competitive advantages of integrating open banking into their systems and applications.
What are the main benefits of open banking?
Open Banking allows third-party suppliers to access financial data and users to benefit from services provided by banks and financial institutions.
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What are the main benefits of open banking?
- improved efficiency,
- cost savings,
- and enhanced customer experience.
Seven Added Values of Open Banking for ERP’s and softwares accounting
- Streamlined data integration: with Open banking , ERP’s and accounting softwares can connect seamlessly with multiple banks and financial institutions, and access real-time data on transactions, balances, invoices, and payments. This reduces the need for manual data entry, reconciliation, and verification, and improves the accuracy and reliability of financial reporting.
- Automated workflows: Open banking enables ERP’s and accounting softwares to automate various business processes, such as invoicing, payment collection, cash flow management, and tax compliance. This saves time and resources, and minimizes human errors and fraud risks.
- Optimized cash management: Open banking allows ERP’s and accounting softwares to optimize cash management by providing a holistic view of the business’s financial position, and enabling smart decisions on cash allocation, investment, and borrowing. Open banking also facilitates faster and cheaper cross-border payments, and access to alternative financing options, such as peer-to-peer lending and crowdfunding.
- Personalized services: Open banking allows ERP’s and accounting softwares to offer personalized services to their customers, such as tailored advice, recommendations, and insights, based on their financial data and behavior. This enhances customer loyalty, satisfaction, and retention, and creates new revenue streams.
- Increased security: Open banking allows ERP’s and accounting softwares to leverage the security standards and protocols of the banks and financial institutions they connect with, such as encryption, authentication, and authorization. This ensures that the data and transactions are protected from unauthorized access, breaches, and cyberattacks.
- Improved customer convenience: With open banking, ERP’s can offer a one-stop platform where their clients can access and control all their financial activities, such as checking balances, making payments, transferring funds, or applying for loans. This eliminates the need for multiple accounts, passwords, or applications, and simplifies the user experience. Open banking also allows ERP’s to integrate with third-party providers, such as accounting software, payment services, or credit bureaus, and deliver more value-added services to their clients.
- Competitive edge: Open banking allows ERP’s and accounting softwares to gain a competitive edge in the market by offering innovative and value-added services to their customers, and by collaborating with other providers in the open banking ecosystem, such as fintechs, aggregators, and platforms. This creates new opportunities for growth, differentiation, and customer acquisition.
What can motivate ERP’s and accounting software publishers to integrate open banking today?
If you want to position yourself as leaders in the digital transformation of the financial sector, you should consider the benefits of open banking for your cutomers and users.
Open banking is a game-changer for ERP’s and accounting softwares, as it offers many added values for their business customers. The figures show that small and medium-sized businesses adopt open banking more quickly and more easily.
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