HOW open banking CAN help BUSINESSES

Open banking is a secure and simple way to help the UK’s small businesses manage their finances more effectively – and become more resilient, productive and profitable.

It does this in two ways.

First, by giving businesses access to up-to-date financial data at any time to enable them to understand and manage their money more effectively – including forecasting, applying for credit, or speeding up payments.

Second, by offering an alternative way to make and receive account-to-account (A2A) payments – to other businesses or to customers – that can be more cost-effective than card payments.

How does it work? 

Your bank account holds a lot of information about your business – cash flow, credit costs, invoicing, payroll – and much more.

By allowing you to securely share that information with regulated companies – such as banks and fintech firms – you can find more cost-effective products and services, and apps to help you understand your business finances better.

Quick guide to open banking for businesses

Our handy guide explains how open banking can help the UK’s small and medium-sized firms tackle late payments, find cost-effective finance, access real-time business insights and more.

Read our guide

Open banking in action…

Faster borrowing
Managing bills better
Cost-effective lending

Tackle business challenges 

Improved forecasting and cash flow

By showing all your account information in one place, you get a single view of all your finances. You’ll have greater visibility of what’s coming in and going out, more control over cash flow and, through improved data forecasting, you’ll be equipped with accurate data to understand and plan your finance.

Tackle late payments

Getting paid on time is a serious problem for many SMEs. Open banking can help address this.  Instead of sending out an invoice, businesses can send out a secure link to initiate a payment, with pre-populated invoice details, eliminating the need for manual data entry. The funds will be sent direct from the payer’s account to yours.

Receive payments faster

Offering open banking to customers or suppliers as an alternative way to pay means your business will receive funds faster (often in near real-time) than card or Direct Debit payments

Cut the cost of card payments

Payment functionality lets your customers make bank payments quickly and easily to merchants instead of using costly card networks – and paying out card processing fees. These cost savings can, in turn result in lower prices for customers.

Manual errors and chargeback fraud

Because customers don’t have to enter sensitive card information, there are fewer errors and a reduced risk of chargeback fraud.

Automate financial management

Speed up traditional finance functions, such as raising invoices and tracking payments, managing payslips and making cash flow projections. More advanced providers can also initiate payments from within their accounting package – faster and more accurate than sending an invoice.

Faster lending decisions

Open banking allows businesses to provide their account history to external lenders, or brokers, and get a quick loan decision without having to provide piles of paperwork. Reducing the amount of manual checks speeds up decision-making and can help open up access to credit.

Smarter business saving

Many businesses have surplus cash (sometimes more than £100,000) sitting in low-interest current accounts. Open banking solutions can automatically switch this cash into higher interest earning accounts and generate income for the business.

Effective accounting

Many businesses now use open banking-driven accountancy software, which enables them to see transactions in near real-time and get an accurate snapshot of their current financial position. This makes it easier for businesses and accountants to collaborate, informing decision-making and boosting productivity.

New ways to pay

Some open banking apps offer the option of payment via a QR code, without the need for a point-of-sale machine. Some charities use these codes on leaflets, magazines or billboards to start a donation journey.

Explore our app store

There are over 50 providers offering the following open banking-powered business services.

GET IN TOUCH

Do you need help with getting open banking solutions up and running for your business? Get in touch today.

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