This year, Open Banking enabled over 2.5 million UK bank customers to connect to third parties. The COVID-19 pandemic caused many concerns about their finances, which resulted in money management apps becoming a popular (and necessary) tool for SMEs.

This guide will help you gain a better understanding of Open Banking by answering the following questions:

  • What it is and what it’s used for
  • How Open Banking will impact accounting now and in the future
  • How Countingup helps accountants stay competitive

What is Open Banking?

Open Banking gives third-party financial service providers open access to consumers’ financial data from banks and other financial institutions. It’s done through application programming interfaces (APIs). 

Streamlining the communication of real-time financial data between banks and trusted third parties gives consumers better access to more transparent and effective financial planning. 

As a result, traditional banks now face competition from smaller, more agile challenger banks and financial institutions. However, Open Banking also affects accountants, which we’ll discuss in a later section.

Open Banking applications: what is it used for?

We’ve listed some of the most popular uses for Open Banking in the finance industry.

Account aggregation

Probably the most popular use of Open Banking that several financial services companies offer. Account aggregation involves using an API to let customers get an overview of their various accounts. Customers can see multiple accounts from various providers on one interface.

One form of account aggregation is called ‘householding’, which links all savings, checking, brokerage, and other accounts belonging to members of a particular household. Married couples or domestic partners may use a ‘householded’ account to manage their shared finances.

Personal finance management

Personal finance management (PFM) tools are meant to give users a complete overview of their financial situation. Open Banking allows PFMs to pull information from multiple accounts into one place.

Being able to access all data in one place can help banks and financial providers get a clear view of how to best serve their customers. PFMs also create financial insights that allow customers to get a complete picture of how their money performs for them.

Lending and insurance

Another way Open Banking can be used is to speed up loan applications by allowing lenders to gain an almost instant overview of an applicant’s credit history. 

Traditionally, lenders asset applicants for loans by pulling together various documents from different banks and institutions, which was slow and time-consuming. Gaining access to important financial data using Open Banking can allow lenders and other underwriters to make quicker, more informed decisions.

How will Open Banking affect the accounting profession?

Open Banking could transform the traditional banking industry. But what does this mean for accountants? We’ve listed the main ways Open Banking will likely affect the accounting profession below.

An evolving role

Open Banking applications can cause concern for accountants since they give users easier, more robust methods for looking after their money themselves. Although, with so many products and services to choose from, clients will look to accountants to help them make the right decision.

The accounting profession is ever-evolving, and Open Banking is an opportunity for accountants to use their expertise and enhance their client experience. As an accountant, you can adopt the role of a trusted adviser and leverage your expertise to offer value-adding advisory services.

According to research, 72% of accountants believe their small business clients don’t understand the concept of Open Banking or the benefits it could bring them. Therefore, you’re in a unique position to enhance your accounting services by offering expert, cost-saving advice. 


Open Banking also creates more opportunities for automation for clients and accountants alike. 

While that may be a worrying side-effect for many accounting firms, automation brings many advantages for accountants. 

For example, by automating mundane tasks, you can spend more time focusing on more valuable work, like client relationship management. Additionally, Open Banking could make tax season easier by giving accountants easier access to client information. 

However, there are several more direct and less error-prone technologies. Rather than indirectly using Open Banking APIs, accounting software like Countingup allows accountants to connect directly to their clients’ business account and gain instant access to their transactions. The system also matches invoices to payments to help with bookkeeping, lets you view clients’ profit and loss, balance sheet and trial balance reports, and features MTD VAT filing. 

Countingup is designed with small business clients in mind. The system is seamless, simple, and straightforward for an enjoyable client and accountant experience. 

Competition from banks

As banks get access to more information in one interface using Open Banking, they might start competing with accountants for advisory services. This is because banks can collect data through open APIs, meaning it’s less risky for them to offer advice to clients. The lowered risk might cause banks to start positioning themselves as business advisors.

As an accountant, you need to be aware of this risk and look at how you can make your advisory services stand out from the ones banks offer. For example, by using accounting software like Countingup that gives you access to your client’s accounts and transactions. 

The insights you get regarding clients’ cash flow, profits, taxes, and so on will allow you to create a seamless and personalised experience. Combining the effectiveness of Countingup with your skills and expertise will help you get ahead of the competition.

Open Banking is a topic that every accountant should be familiar with, even if it’s only to inform clients about how it works. We hope this has given you the insight you need to get the most out of the situation this new technology presents. 

Keep your competitive edge with Countingup 

You can save your practice time on manual admin and help your clients keep organised records with Countingup’s free accounting software. It’s built specifically to help you manage your self-employed and sole trader clients. Our software is MTD-compatible and full of features for accountants to review and manage client accounts efficiently, with direct access to their real-time organised data. Find out more here.


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