Contractors are busy people, so anything you can do to reduce the amount of admin you do is a good thing. If the same action can also make communication with your accountant more efficient, and improve the quality of the advice you get, it’s definitely a great idea, so in this article we’re looking at open banking feeds and how they can save you time.
What is open banking?
Open Banking allows you to give your bank permission to share your data with authorised third parties. For our purposes, this means FreeAgent can access your banking information automatically. Once you’ve set up your bank feed and given your permission, you don’t have to enter information manually, which saves you a lot of time.
There are other advantages as well:
Accurate record keeping – Manual data entry always comes with the chance of errors. Typing errors can be easy to make and difficult to spot, even if you check everything carefully. Drawing transactions through from your bank feed eliminates this kind of error.
Historical – Transactions will be pulled through from the last one entered on the portal, so it won’t miss previous transactions.
Guess explanation – This feature attempts to automatically explain your transactions based on existing information in your account. This means your monthly bookkeeping takes even less time as you bulk approve transactions ready for your accountant to review.
Proactive advice – If your banking is constantly up to date, your accountant will have accurate information to hand to provide you with proactive tax planning advice.
Timeliness – With the bank feed and guess explanations functions, you’ll be able to send your information quicker meaning that you’re less likely to miss deadlines and you’ll know your tax liabilities sooner.
Setting up open banking feeds in FreeAgent
The process for enabling opening banking feeds in FreeAgent is slightly different, depending on whether you’re a new or existing user. If you already have a bank feed set up and you want to swich it to open banking, you can find instruction here.
Navigate to the banking tab and select “connect your bank”. FreeAgent will then lead you though the process of setting up your bank feed.
If you’re already using FreeAgent you’ll be taken to the Bank Accounts Summary page, where you can select the bank account you want to enable the feed for in the list. You will then need to:
· Select the enable bank feed
· Select your bank from the list
· Select the bank service (if your bank offers more than one service that FreeAgent can connect to)
· Give consent for the connection
· Authorise the connection with your bank
· Choose an account and transaction start date
The whole process should only take a few minutes.
Is open banking secure?
While no system is 100% secure and it’s important to remain vigilant, Open Banking represents a tightening of security for automatic bank feeds and other third-party services. FreeAgent does not store your login details, and you are completely in control of which data FreeAgent can access from your bank.
If you have questions of if we can help in any way, please call our expert team on 01296 468483 or email firstname.lastname@example.org.