Santander became the latest bank to invest in cloud accounting technology for small businesses when it acquired Albert in December.
The Spanish banking group bought the UK-based invoicing app for sole traders and micro businesses in an attempt to fight off competition from challenger financial firms and other established banks.
Lindsey Argalas, Santander Group chief digital and innovation officer, says:
“It is our shared belief that small businesses owners should have access to the tools that help them work smarter, and that deliver the same instant, seamless and personal experiences in finance, as they get in their daily lives.”
The Spanish acquisition comes after the Royal Bank of Scotland (RBS) bought the FreeAgent accounting software company and began offering the software to RBS and NatWest small business customers free of charge.
In 2016, Barclays announced a new partnership with Xero, a cloud accountancy software provider based in New Zealand. The deal gave Barclays’ business customers easier access to Xero services designed to help them grow.
These strategic acquisitions make it easier for small businesses to access new bookkeeping and accounting solutions. It also blurs the lines between business banking and accounting and could result in a financial technology arms race between banks.
Miles Grady, Director of Cloud Accountant said:
“These acquisitions bring more credibility to cloud accounting software businesses that were, until recently, viewed as pesky upstarts by the established banking sector.
It also betrays a sense of unease from the major banks. Santander, RBS and Barclays could all create their own small business accounting solutions, but the introduction of Open Banking means that any reliable third-party fintech company can get a customer’s transaction from a bank and use it in their app.
This effectively eliminated a competitive advantage that banks have sat on for decades. And the increased competition has lead to the creation of some great new software solutions for small businesses.
Making Tax Digital is another driving force behind the growth of this software. As more businesses are required to keep digital tax records, we expect to see more business owners making the switch to cloud accounting.”
CloudAccountant offers accountancy support packages with popular cloud-based platforms FreeAgent and Xero. Get in touch for more information. Call: 0808 281 0303, email: team@cloudaccountant.co.uk or visit www.cloudaccountant.co.uk