Just as open banking is transforming financial administration, robotic accounting is set to transform the way accountants work. The future of accounting will see increased productivity going hand-in-hand with provision of a more bespoke service, as accountants find themselves adopting a more advisory role.
So why now? Automation itself is nothing new. But the advent of open banking means accounting software can reach far further into business matters, and then use machine learning (ML) and Artificial Intelligence (AI) to make informed decisions, without human intervention. It’s a game-changer for financial services.
We explain why robotic accounting, performed via Robotic Process Automation (RPA) tools, is something no accountant can afford to ignore, and the role Ponto plays in making this possible.
What Is Robotic Accounting?
Robotic accounting, as its name suggests, automates repetitive accountancy tasks such as retrieving and processing data, maintaining records and performing calculations to perform account reconciliation, fraud detection, compliance reporting and much more. Working accurately, efficiently and tirelessly 24/7, robotic accounting ploughs through the accounting workload in a fraction of the time it would take a human, at a fraction of the cost. But far from being a threat to human accountants, this is a huge opportunity for the financial services industry.
Freed from having to perform mundane tasks, accountants can focus their attention on clients’ individual needs. By leaving the rule-based work to accounting software, accountants can utilize their expertise to play an advisory role in navigating more complex and strategic aspects. With this, their personal value to clients increases. It’s an all-round win, as clients get deeper insights and more bespoke service, while accountancy firms have capacity for serving a greater volume of clients. As robotic accounting becomes more prevalent, those who don’t adopt it will soon get left behind.
How Open Banking Is Fueling Robotic Process Automation (RPA)
Robotic accounting relies on data to do its job. Lots of data. And open banking makes access to this data possible in a way it never was before. This is because open banking enables RPA tools to obtain transaction information from multiple banks via APIs.
With traditional banking, RPA tools had to log in separately to every different bank environment, extract the relevant data, and then normalize it across the banks’ different formats before being able to add value. Not an easy task, given the amount of different, ever-changing bank channels and formats involved. But with open banking, RPA tools have an opportunity to connect to the various banks’ APIs and extract transaction data in a machine-readable format.
When an open banking provider (such as Ponto) is brought into this process, it becomes much simpler, as the connections to all the different banks are done via a single, harmonized API. What’s more, the RPA tool can also be instantly triggered into action to retrieve the necessary data whenever relevant.
Is Robotic Accounting Safe for Accountancy Firms and Their Clients?
Because RPA relies on open banking for its data, natural concerns over data security and privacy are taken care of via the stringent regulation around open banking. Using RPA tools to carry out robotic accounting alleviates the risks associated with humans having access to clients’ bank accounts. Robotic accounting is therefore safe for accountancy firms and their clients in terms of data security and privacy.
Robotic Accounting Solutions
Robotic accounting is already available in some form within many cloud accounting solutions, such as Moneybird, Wefact and Clearfacts. While RPA is reliant on harmonized data, the solutions themselves rely on open banking providers, such as Ponto, to extract and deliver that data.
The choice of open banking provider for feeding each RPA tool is therefore massively important. Given that the thousands of banks involved are constantly updating their own APIs, it’s essential that the open banking provider keeps a continual watch on this and responds accordingly. As providers of a service that underpins modern accounting software, they also need to keep a vigilant eye on the future of accounting, and have a vision of how to take open banking into open finance and open data.
Ponto, which continuously monitors and updates its API connections to 2,000 banks across Europe, while proactively developing for the future, already provides Moneybird’s connectivity and will shortly enable Clearfacts to initiate payments based on attended RPA (process automation, but with a human control step).
Open banking is already a game-changer for finance management. And as this quickly spins off into automated accountancy solutions such as robotic accountancy, the role of the human accountant needs to evolve.
Here at Ponto, where we provide the connections which facilitate all kinds of accountancy software, we see robotic accountancy as a golden opportunity for accountants to distinguish themselves through personal service while satisfying larger volumes of clients.