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Yodlee Signs Aussie Startup MoneySoft in BlueChilli Deal

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Global bank feeds provider Yodlee has signed accounting software startup MoneySoft in a deal with Australian incubator BlueChilli.

BlueChilli startups received access to bank feeds from 12,000 bank accounts in Australia, the US and other countries through Yodlee platform.

The startups could connect consumers’ financial accounts such as credit cards, investments, loans, bills, and rewards to new online and mobile services.

Bank feeds were increasingly common features of online accounting programs. Yodlee already provided bank feeds for several cloud accounting programs in Australia including Xero, Saasu and the upcoming Reckon One.

Australian owned MoneySoft was a personal finance program that competed with Intuit’s Mint and Xero Personal. Yodlee sold a similar service called Yodlee MoneyCenter.

BlueChilli had invested in 30 companies since its launch in 2011.

 Image credit: Moneysoft

Reckon One – A Hands-On Beta Review

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After a few months of eager anticipation, last week I finally got my hour on the keyboard at a training session on Reckon One. I don’t want to be too judgemental at this stage as there is a lot more to be rolled out before the initial release.

Overall the experience was somewhat disappointing in that although I did manage to connect fingers to the keyboard, there wasn’t a whole lot more to see than had been demonstrated at the Reckon roadshows. I was able to see some functionality on a little more detail and get a better idea of how the product hangs together which was helpful.

Following are my impressions, likes and dislikes.

 

The Dashboard

The dashboard was a feature that caused excitement at the roadshow. It is both visually appealing and fully customisable. Unfortunately this is still under development so although I could select some additional widgets, I didn’t get any data to display apart from the banking summary. This feature is in the Pending file.

 

Mobile App

This was another area that received considerable acclaim as Reckon demonstrated that it would be deploying a feature-rich mobile app. However, it must also be considered that Reckon One’s browser-based app will not be available on Android or Apple mobile devices as it requires Microsoft’s Silverlight technology.

As Reckon One users can only use the mobile app on mobile devices, Reckon had to make it function rich.

 

Banking

One module that was not available at the training session was the bank feeds, rules and reconciliation. This was a little disappointing as this is a stand-out feature of Reckon’s cloud rival Xero. Reckon One must be at least on a par with Xero if it is going to gain market share.

I was particularly interested to see the solution that Reckon would deliver, but again I’ll have to wait a little longer. I did confirm that there will be direct bank feeds from some of the major banks and that the others, building societies and credit unions will be via US financial data services supplier Yodlee. The pricing for the bank feeds module would depend on the number of transactions downloaded, not the number of individual bank feeds.

 

BAS (business activity statements)

This is the second make-or-break feature that Reckon One needs to deliver, but currently there are some limitations. While you can add new tax codes, they will not be reported on the BAS reports. The BAS appears to be limited to GST reporting and does not allow for FTC (foreign tax credit), FBT (fringe benefits tax), LCT (luxury car tax), WET (wine equalisation tax) or even the Wages and PAYG Withheld amounts.

Currently it just produces the equivalent of the Calculation Worksheet and there is a button to lodge the BAS but this requires the user to go through Reckon’s GovConnect (a module in Reckon Accounts desktop software).

It is worth noting that Intuit, the developer of QuickBooks Online, has just bowed to market pressure and enabled the extra boxes on their BAS form. Hopefully Reckon will do the same, otherwise this could become a limiting factor.

 

Reports

Reckon One has just 20 reports, many of which are straight lists. A few of the reports such as the Profit and Loss can be run either on a cash or accrual basis which is welcome. But many others appear to be cash only, such as top customers, top suppliers, etc.

The ability to drill down from a report to transactions is a feature yet to be delivered and the full-blown report customisation available in Reckon Accounts will not be a feature of Reckon One. I am really hoping there will be some more reports rolled out especially an Aged Customer listing.

 

Projects/Job Costing

Reckon Accounts has probably the best job costing and reporting functionality of all the small business accounting software packages. Reckon has decided to continue this in Reckon One.

This will give it a competitive edge over Xero which requires users to add a third-party cloud program. However, right now Reckon One is a bit short on specific functionality and also reports. You can link specific pricing to a project which may be useful where customer specific prices have been quoted.

 

Chart of Accounts

This is not functionality that excites or interest most users, but I am quite particular about what is in and what is out of the chart of accounts. I wasn’t too happy when I discovered there was no breakdown between current and non-current liabilities or assets, which has long been a beef of mine with Saasu.

Also there is no account type for Cost of Goods Sold which is unfortunate because even though there is no inventory module as yet it would be helpful for reporting on Gross Margin.

Budgets

Again, not a feature of great interest with many small businesses (I have trouble getting most of my small business clients to do budgeting at any level). But the level of functionality in Reckon One is quite extensive.

 

Multi-Currency

Like payroll and inventory this will not be available in the initial release. This puts Reckon One at odds with Xero, Saasu and QuickBooks Online as they all have multi-currency functionality which is a requirement for a high percentage of small businesses.

In summary I found Reckon One easy to navigate and visually appealing but that could partly be because the available functionality was somewhat limited. There were a number of small, irritating features that I think could easily be ironed out with a little more attention to the user experience.

The product does have potential but there is a way to go before it can seriously take its place in the market as accounting software of substance. There are some excellent building blocks in place, but very little icing on the cake (mixed metaphors again).

Release dates continue to slip and whilst it is important to ensure a quality product is delivered, for me it raises the issue of the subsequent releases. Some modules including payroll, inventory and multi-currency will not be available with the initial release.

Xero only recently delivered an integrated payroll solution and still doesn’t have inventory but there are so many add-on solutions this isn’t an issue. Reckon One will be shipping without any APIs (the software connectors which integrate it with other cloud and desktop programs) so what you get is what you get.

I would be reluctant to migrate to Reckon One immediately unless I had a very simple business model whose requirements could be met with the functionality in the initial release.

This post originally appeared on the Businesseez blog.

Yodlee Disputes BankLink's Accuracy Claims in Bank Feeds

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  • BankLink’s 99.9999% accuracy claim “impossible”, says Yodlee
  • Errors created by banks, say BankLink and Yodlee  
  • Screen scraping as accurate as direct feeds, says Yodlee

BankLink’s claimed accuracy for importing bank transactions to accounting software was impossible, said chief competitor Yodlee in an interview with Digital First.

“I don’t believe it. How could they do that? Unless they’re going into every bank physically, hourly, saying, Is the system of record correct? Is the system of record correct?” said Joe Polverari, chief strategy and development officer at Yodlee, who spoke to Digital First in Sydney earlier this month.

BankLink claimed that, after validating transactions received from banks with its proprietary systems, it could achieve 99.9999 percent accuracy with less than 10 errors a month. Yodlee claimed it could achieve 99.8 percent accuracy for a similar service. Cloud accounting programs Xero, Saasu and Reckon One used bank feeds from Yodlee while BankLink was used by CCH iBizz, MYOB AccountRight Live and LiveAccounts.

MYOB bought the Australian and New Zealand divisions of BankLink last month.

Errors in bank feeds such as omitted or duplicated transactions have caused problems for accountants and bookkeepers using cloud accounting software.

“We are confident of our previous statements about the high accuracy and reliability of BankLink’s secure and direct bank feeds,” said Richard Reese, BankLink’s general manager of operations, when contacted for comment.

BankLink was reluctant to release details about its error detection processes to protect its claimed competitive advantage. The company pointed to public statements about its processes.

“BankLink applies a series of proprietary, data validation routines to all bank transactions that identify and correct any anomalies in the data. This sophisticated error detection system results in a significant increase in data accuracy. Furthermore, BankLink’s direct contractual relationship with the banks means that they have protocols in place to fix any errors promptly without any interruption to service,” BankLink said in a recent press release.

Yodlee and BankLink said errors were usually generated by the banks’ systems of record and later updated. Errors occurred in around 1 percent of bank accounts each month and had to be corrected, BankLink said.

“When an error is detected, we have protocols in place with the banks to correct the error,” BankLink CEO John Dunkerley told Digital First in an earlier interview.

“Firstly, our data processing systems detect those problems, then our data team engages directly with the bank to address the issue with the feed. Until the data is correct, we do not distribute it,” Dunkerley said.

Yodlee claimed it had never created errors in bank feeds.

“We haven’t had any material issue with folks saying the data is not reliable or that it’s inaccurate data because it’s really just a picture of what’s in there. The system of record for our purpose are not perfect,” Polverari said.

BankLink had contractual arrangements with more than 100 financial institutions in Australia and New Zealand to supply bank transactions directly. Yodlee, which has direct relationships with 80 percent of financial institutions in the US, relied primarily on a technology called screen scraping to compile bank feeds for Australian bank accounts.

Screen scraping copied transactions from a user’s online banking account and recreated the feed automatically. Bank feeds created through screen scraping were as reliable as direct feeds, Polverari said.

“We have to manage 13,500 data sources (banks) with multiple times more core systems to make sure that the data that’s in the account at the time it’s needed. And we are good with that to a 99.8 percent accuracy, whether it’s data feed or screen scraping. It makes no difference,” Polverari said.

“We have never had an instance in the history of the company where the data we have brought back is not the data that was in the system of record,” Polverari said.

“Our data is so fresh and reliable that there is a major bank in the US, a top 20 bank with millions of online users, we actually are their system of record,” Polverari said.

“MYOB chose to work with BankLink for its proven reliability, security and coverage of feeds from financial institutions across Australia. BankLink feeds are 99.9999 percent accurate and in some cases, more reliable than the bank’s own raw feeds,” said Ben Ross, MYOB’s general manager, user experience and design, in a recent press release.

Yodlee Opens Up on Bank Feeds: Interview

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  • Screen scraping just as accurate as bank feeds
  • Yodlee audited for security by top 20 US banks and federal government
  • All Australian banks will accept Yodlee methods within three years

In the heated debate about bank feeds for cloud accounting programs, one voice has been noticeably absent. Yodlee is one of the biggest financial data aggregators in the world and the supplier of bank feeds to cloud accounting programs Xero, Saasu and the soon-to-be-released Reckon One.

Yodlee’s software company customers have signed non-disclosure agreements which forbade them from discussing Yodlee’s technology. As a result, Xero and others have been unable to combat effectively accusations that bank feeds supplied by Yodlee were insecure or inaccurate.  Rival BankLink in particular has criticised screen scraping, where Yodlee created a bank feed by copying transactional information from a user’s online banking screen.

Last week Yodlee’s chief strategy and development officer, Joe Polverari, visited Sydney on a trip to meet clients. Digital First interviewed Polverari about Yodlee’s technology, security, screen scraping and its plans in Australia. Below is an edited transcript of the conversation.

 

Digital First: Some Australian banks say that Yodlee users are breaching terms and conditions by handing over credentials. What’s your take?

Yodlee: For us it’s a question of understanding and education. We are a relatively new in the market, even though we have large customers like the ANZ Bank. In our home market we are powering most of the digital experiences for most of the largest banks. And we’re doing that with a data utility that is unique in the industry, that is highly secure, that is regulated by our federal government and is audited by each and every one of our customers.

Is this something people are comfortable with in our market? Absolutely, this is the way things are done in Australia and New Zealand? Not yet, but they will be comfortable because I’ve seen it happen again and again in Canada, in Mexico, in the UK and it will happen in Australia.

 

Digital First: Where do you stand on direct bank feeds versus screen scraping?

Yodlee: The conversation is about data feeds or data acquisition, which is screen scraping or html data gathering. We take 85 percent of our data on a volume basis from most of the biggest financial institutions in the world and give it to 50 million end users on a data fed basis, not screen scraping.

 

Digital First: Is that 85 percent in Australia as well?

Yodlee: No, that’s outside in Australia. That 15 percent is what we call the long tail. The ANZ Bank is one data source, but it has multiple account types and we cover all those as well. We have over 10,000 data sources in over 100,000 account types, all represented in our data utility, 85 percent of which on a volume basis get delivered through feeds.

 

Digital First: So Australia sounds like the land of the long tail – most of Yodlee’s transactions here are gathered through screen scraping. Are you working to change that?

Yodlee: Yes it is, and yes absolutely. And the way the Yodlee model works is that as we scale up volume in a region we certainly have outreach into the financial institutions or they have to us where we both agree that it’s better to have a data feed.

The other thing to keep in mind is that this is entirely a consumer permission or business permission model. We don’t do anything around data until the ‘owner’ of that data says ‘Please go do this’. So really Yodlee is a bunch of users who own accounts, wanting to come up with a more automated way of seeing and using those accounts for their benefit.

 

Digital First: What percentage of feeds in Australia are direct?

Yodlee: We don’t publish that information. We do have feeds in Australia and we do do more screen scraping in Australia than feeds.
Digital First: You say you aren’t known to consumers here. But don’t you have to convince the banks? Because the banks are saying they might not pay out if your account is defrauded because you shared the password.

Yodlee: That is competitively motivated by risk guys that don’t understand technology, to be totally honest with you. And to give you an idea of our technology, we are more secure from a digital perspective than any online bank out there. I’ll tell you why.

Our very first customer was Citibank. Our second customer was Bank of America. Our third was Chase. We went through the top 10 US banks accumulating users and technology, and every single one of those banks runs you through an audit process and a security process that is exhaustive.

When you go to Citibank they say great, you will do security our way. Then you go to Bank of America and they say, we don’t care what Citibank does, you’re going to do it our way. And so on.

Then the US federal government comes in because we are considered a tier one tech provider to the financial services space. That means that if something bad happens to us there’s a risk to the integrity of the entire financial system because we have so much data in there.

And so they say we’re going to supervise you too and we have our own audit processes and own security procedures.

After you’ve done that for 12 or 13 years for all of those fairly heavyweight organisations, you’re pretty airtight. Now the discussion at least in the US is never around security. To the contrary, we have made so many innovations in security that some of the banks have rolled them out internally.

It’s easy to gloss over (screen scraping) and say it seems insecure without truly understanding what the technology is and how it works and who it’s been vetted by. We’ve not had an incident in 13 years.

 

Digital First: But the bank says it won’t pay out on the account if there’s fraud.

Yodlee: That’s what they said in the US back in 2000 but they gave up on that because they didn’t want to cross their customers. And they knew that we were more secure than they were at that point.

They said it in the UK but they don’t say it any more. Some people say it in Australia – not all. Soon none will say it. Soon could be one to three years, who knows.

[Read more…]

Xero and Yodlee Unite Against Intuit

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Cloud accounting company Xero and US financial data aggregator Yodlee have formed a partnership to tackle accounting services giant Intuit.

“The way we view this partnership is that we have the best of breed data platform, these guys (Xero) have the best of breed accounting technology, and together there’s a lot of mutual parties that have adverse interests that we are taking on together,” said Joe Polverari, chief strategy and development officer for Yodlee.

“It’s a really a nice match. It’s great for our business and hopefully good for (Xero’s) business as well, as they’re knocking off QuickBooks which is owned by Intuit who is our competitor,” Polverari said.

Intuit held over 80 percent of the market for small business accounting software in the US and sold a data aggregation service that competed against Yodlee. Yodlee supplied bank feeds to Xero for 10 percent of Australian bank accounts held by Xero users and a much larger percentage of international bank accounts.

“Look at QuickBooks which has dominant market share in the US right now. Xero has a better product. We have better data. And we can help them move very fast,” Polverari said. “We’re going to help them innovate in a market that is very lucrative and is ripe for disruption. This time it will be at the expense of QuickBooks if we’re doing both of our jobs right.”

Competition between Xero, Yodlee and Intuit would produce better products for customers, Polverari added.

“Better data plus better technology on the accounting side equals a better solution for accountants, bookkeepers and users equals a better market. That’s what’s happening, right?” he said.

Yodlee, which has relationships with thousands of banks and financial institutions, said it wasn’t introducing Xero to banks in the US.

“Right now we won’t, (Xero) are doing great on their own. Even though we have the world’s greatest bank relationships inside the US,” Poverari said.

Image credit: gvpedia.com

About D1

Digital First covers news and opinions on accounting technology and is read by tech-savvy accountants who understand the importance of technology in establishing competitive advantage.
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