It’s been a busy year for us all in the accounting industry. Making Tax Digital, changing the way many businesses submitted VAT returns, kicked off in April. And now there’s PSD2, a European standard changing the way banks connect to third parties such as Xero.
One aspect of PSD2, called Strong Customer Authentication (SCA), was due to take effect from 14 September. This meant Barclays feeds, and all UK and EU bank feeds set up using Yodlee, would not have been available from that date and would need to be replaced with new ones.
SCA will still impact the availability of these feeds. But following a recent announcement from the UK’s Financial Conduct Authority (FCA), customers may now have more time to make the necessary changes.
FCA grants six month ‘adjustment period’
We were pleased to see that the FCA recently granted a six month ‘adjustment period’ to the SCA rules for UK banks. This is good news and is something we’d lobbied for because of timing concerns and potential negative impact on customers.
This now means that a large number of banks can continue to allow customers to use their existing Yodlee feeds from 14 September 2019, in some cases, until as late as 14 March 2020 – and the disruption to businesses will be minimised.
We believe that Open Banking as a movement is a good thing, putting you in control of your banking information. So we’d encourage you to move over to your new bank feed as soon as possible to avoid added stress come tax time.
Changing to new feeds as they become available
If you have updated your bank feed already, you’re one step ahead. You don’t need to do anything now, apart from re-authenticate your feed every 90 days when prompted. But if you haven’t yet updated, there’s some good news. Since this development – depending on who you bank with – there could be more time for you to update.
We’ll let you know on your Xero dashboard as soon as your bank feed is ready. Or you can check in on our list of affected bank feeds, which includes expected dates of availability.
And for our accounting and bookkeeping partners, it’s now easy to see your affected clients. Just log in to Xero HQ and navigate to Explorer to see a list of clients and their actions.
Keeping up with the regulations
Given the nature of this regulation, and indeed the differing stages of readiness among the banks, changes will be implemented at different times, depending on which bank you connect to Xero.
A specific update on Barclays feeds – they’ll now continue to be available until the first quarter of 2020, along with most Yodlee feeds.
As other banks respond to the FCA’s adjustment period we’ll keep publishing updates to our list of affected bank feeds. Due to the scale and number of banks involved, we’re phasing our rollout over the coming months.
This means that a number of current feeds will continue to work as normal from 14 September until you see an update on your Xero dashboard when your new feed becomes available. The most important message from us is that you should check the bank feed list above for an update on your specific bank accounts.
New switching dates for some bank feeds
Note: When we first published this blog, the following feeds needed to be updated by 12 September. These have now been updated. Please see below for confirmation, or check in on our bank feeds list.
Businesses using some Yodlee feeds will still need to switch to new direct feeds to avoid losing the benefits of having a bank connection, such as easy bank reconciliation. These dates are now as follows:
- AIB (UK) – Current and savings accounts – 12 September 2019
- Danske – Current accounts – 12 September 2019
- Nationwide – Current accounts – 24 September 2019
- Natwest – Current accounts – 24 September 2019
- RBS – Current accounts – 24 September 2019
- Ulster UK – Current accounts – 24 September 2019
- First Direct – Current accounts – 14 March 2020
- HSBC – Current accounts – 14 March 2020
- M&S – Current accounts – 14 March 2020
What if my existing feed stops importing transactions?
If your feed stops importing transactions, you’ll need to manually import statements into Xero. While this is a manual task, it’s a simple process – there’s no need to type data into Xero by hand.
How can I find out more?
Visit our Open Banking resource centre where you can find information and resources to support you and your business.