Tags: accounting, updates, bank feeds, integrations
In 2015, the European Union proposed the Open Banking Standard Initiative and accepted the Revised Payment Services Directive PSD2. The implementation of the Open Banking standards should promote faster innovations in the financial sector, and increase the competition amongst the banks.
Open Banking is a broad term that includes many different processes, from account aggregation to verifying account ownership and payment initiation.
The key point, when implementing the Directive, European banks had to enable clients to receive the information about their financial transactions (through the open APIs) in the way most convenient for the client.
As a result, bank clients were able to automatically receive information about the transactions, even without opening bank’s website, for example, see all their accounts in different banks in one personal finance application on smartphone.
For the entrepreneurs it means the opportunity of the automatic upload of the bank transactions to the accounting system, without wasting time on the manual XML/CSV files upload – everything happens automatically. The bank transactions appear in the accounting system without delay, resulting in accurate picture of the company’s finances.
For the accountants bank feeds means an increase in productivity since there is no need in entering bank transactions manually, and efficiency as there is no need in bothering the clients about getting statements and wait for them to be sent.
In PayTraq, you can enable the automatic transactions upload from the major banks; this integration has been provided by one of the largest European aggregators – Nordigen.
It is important that the use of Open Banking features for users is completely free!
In order to connect, please go to the Money -> Bank Accounts section, and then to the "Bank Feeds" tab, here you can see the list of the channels available for the connection. Those that can be connected using Open Banking API, contain record "Banking data API provided by Nordigen".
After you have chosen the feed and clicked on the "Activate" button, you will be redirected to the aggregator’s authorization page, where you need to confirm your consent to receive the data in PayTraq. After that, you will be redirected to the bank webpage for the authorization and the final approval.
Please note that one of the Directive PSD2 requirements is that after 90 days you need to re-authorize the connection to the bank data transfer channel. The expiration date of the current connection is displayed in the channel information.
Hint: If you have several bank accounts in the program, connect them on the same day in order to re-authorize them in one go after 90 days.
You can achieve even higher level of automation if you enable the automatic reconciliation after the activation of the bank channel.