Users of cloud accounting software that utilise the bank feed feature need to be prepared for major changes that will come into effect from March 14, 2020, especially if they are with Barclays.
These are a result of changes to EU law that are designed to create an ‘Open Banking’ system which will allow banks to share data more reliably and efficiently.
The changes will come into effect from September 14 of this year, but the UK’s Financial Conduct Authority has advised a six month transition period, in which case users have until March 14 2020 to make the transition.
The extent to which users are affected depends on who they bank with and whether they are using a direct feed or a third party (Yodlee) feed.
Explains TC Group’s Cloud Accounting Partner, Andrew Perrett: ‘It is absolutely essential that all users of Xero are fully aware of these changes. To check your status simply go onto your Xero dashboard and you will either see a bank’s logo, or not. If not then you are on a third party feed and this will not work as from March 14 next year.
‘If you have a third party feed we advise upgrading to a direct bank feed, but if this isn’t available yet then you will have to manually input data for the short term. For most direct bank feed users there should be a seamless transition to the new system, but with others you will have to move to the new Open Banking channel and this is definitely case with Barclays.’
New on-line feeds are being activated over the next six months, so users are urged to make the necessary arrangements well in advance.
If you are setting up completely new bank feeds in Xero, then the new direct feeds using Open Banking will be available over the intervening months.
For further information about how the new Open Banking system may impact on you, and for details about bank feeds and options, please contact your local TC Group partner or client relationship manager.