Fintech: The apps your clients will be using in the near future
Fintech watcher Bobby Chadha reveals how Facebook, bitcoin, business banking and others are going to disrupt the traditional relationships accountants have with their clients.
After speaking to a few accountants recently, I was asked my opinion on how tech is changing and the impact on our clients and us as their accountants.
I thought I’d share some of the changes that are coming our way and I’ve added my own thoughts as an accountant.
Facebook: How we Bank in the future
Facebook wants financial data such as transactional and cards info from banks, but why?
Well, Facebook wants their users to carry out banking tasks via FB messenger. Actions such as checking their bank balance, alerts to problems and potentially even transferring money to other registered users are what Facebook wants to do.
Now we all remember the recent problem Facebook has had with privacy and its tendency to sell user data to third parties. This is something we all should consider before authorising our data for use with these types of platforms.
This could be possibly the way we and our clients bank in the future. On average 1.47 billion people log in daily to their Facebook account, so it makes sense in a weird way that you consume all other key services from that one platform.
Do you accept card? Yes and Bitcoin
What is Bitcoin? Bitcoin is a form of currency and an accounting headache which aims to create a financial system of sorts but without the traditional ‘controlling’ systems like banks, state banks etc.
Bitcoin transactions are masked and are not tied to any one institution. This is a good thing as it becomes easier to trade globally with one value vs the headache of fees and fluctuating foreign exchange accounting swings to deal with.
Okay - so what’s the impact on our clients? There are some startups who accept bitcoin as a payment method. I recently visited a coffee shop which accepted bitcoin (but didn’t see anyone actually paying for their cuppa with bitcoin).
Another point regarding accepting bitcoin as payment is the fluctuation on bitcoin prices. It’s very volatile and changes by the hour. Once cryptocurrency becomes widely accepted at scale and becomes less volatile, I believe businesses of all sizes will support this payment method (good luck with the accounting!).
Starling and Tide: Business banking becomes free and all in one
Businesses have never had it better when it comes to ‘banking’. Starling has free business accounts, which are fee-free (no more switching every 12 months for free banking and a parker pen), and it’s developed mobile-first.
Tide is focused on the small business vertical with features such as income/expense categorisations, invoicing and in the near future, MTD capability for filing and other accounting features.
What I find interesting is how the traditional relationships we accountants have with bank managers might change. Currently, we refer clients to banks for borrowing, fund transfers, lease loans etc. But with banks now becoming app only, will this mutually beneficial relationship cease to exist?
Same goes for other services we refer our clients on to; for example, mortgages, insurances and IFA’s.
Platforms such as Habito.com, where they act as an online mortgage broker are growing rapidly and are genuinely saving people money and time. But do they know their lenders so well that they can help me match my client’s financial circumstances to a lender who is willing to lend at a reasonable rate?
Google for sending money
“OK Google, pay my £400 towards my credit card.”
Google is working on its mobile payment platform and wants us to use their service to pay our contacts. You can also ask Google to request money from contacts.
Imagine chasing invoices through Google assistant in the future. Google’s voice and payment services will be embedded across all their services from Gmail to its Gsuite apps but with the growing popularity of voice command interactions, we can expect our clients to be carrying out their banking by simply commanding it.
MaxTax and Taxfix: How people complete simple tax returns
HMRC has made the term ‘taxes’ one of the hot topics of 2017 and it’s set to continue in 2018.
Through their development of MTD (sorry, I said the ‘M’ word) HMRC is wanting developers to help make taxes simpler to do, whilst hoping to save money on their own infrastructure costs (good luck with that).
This development has led to a number of apps taking advantage of the idea that taxes should become simpler to do.
TaxFix in Germany recently closed a £13m series A round which allows German taxpayers to file simple returns through their app.
Closer to home, apps like MaxTax.io (my own plug) which uses a smart ‘bot’ through Facebook messenger and is backed by an accounting firm (because you can’t replace good tax experience...just yet) and others, are leading the charge on making the process of a tax return self-served and cheaper to do.
Need a loan? Just connect to your accounting software
KYC checks, trading accounts, multiple HMRC documents and a dollop of begging the business managers was how we typically borrowed for small businesses.
The typical way of borrowing will soon become connecting to a platform such as Funding Options in order to get a loan from iwoca or Zopa and your accounting platform like Xero or even your bank (thanks to open banking).
Oh and the way we approach our health issues will change.
Babylon health app: our new GP
Babylon health which also powers the NHS ‘GP on hand’ app is an AI-powered app which looks to assist and possibly replace doctors in the future.
It’s a simple app which asks you questions about your symptoms and it then recommends next steps and what symptoms you should look out for.
GP on Hand’ is a simple Face-Time-type app which allows people to connect with GP’s at a click of a button.
What other apps/tech not listed above have you or your clients utilised?