The elephant in the room when we look at cloud accounting solutions has always been direct bank feeds. And for the longest time, Xero has prevailed over its competitors here simply because of its stranglehold in this area.
The reason for its importance is rather simple; you can diligently do your data-entry for book-keeping but all these hard work won't matter for real-time reporting if your book's bank balance does not reconcile to your physical bank balance. And only with direct bank feeds, can you truly reconcile on a real-time basis efficiently. It's strange why the other players didn't challenge Xero in this aspect.
So when the Start Digital initiative got the press coverage a few days ago, I had expected Xero to dominate the accounting solutions offered. I was quite surprised when this wasn't so.
In fact, the trend seems to be moving towards banks offering direct bank feeds to their own "preferred" accounting solutions partner. Financio has direct bank feeds to Maybank and DBS but not UOB and OCBC, and SAP One only has direct bank feeds from UOB. Surprisingly, most banks in the initiative offer other solutions over Xero. In fact, Xero is only present in the solutions offered by OCBC and only as one of the options. Which is quite ironic, as they still don't have a direct feed to Xero as of today.
So while Xero is still the only solution with the most direct bank feeds, alternatives are appearing on the horizon. But the bad news is that the competition might not be as open as we hope for.
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