Irish banks and regulators have been "very slow to move with the times" regarding new rules for so-called open banking, according to the chief executive of online accounting company Big Red Cloud.
Marc O'Dwyer, whose company provides online accountancy software to thousands of small and medium Irish businesses, told the Sunday Independent the pillar banks and Central Bank have been slow to fully implement the new European payment services directive. It is aimed at boosting innovation and helping banking services adapt to new technologies and could provide efficiencies for small companies, he said.
"It cuts down the laborious workflow that was there between banks and businesses, making the process more digital and dragging the banks into the 21st century," said O'Dwyer. "The Irish banks are very slow to get going on this."
Online accounting platforms such as Big Red Cloud are likely to have to go through a regulatory process to become authorised account information service providers (AISPs).
"That is potentially a 12- to 18-month process in order for us to become regulated and to allow us to link the Big Red Cloud with the pillar bank account that the business owner uses," he said.
For Big Red Cloud, this has slowed down a potential hook-up it is planning with Plaid, a fintech which develops technology to allow easier sharing of financial information between banks and service providers and which was bought by Visa in January for $5.3bn. The Irish company plans to offer the Plaid service through its platform to its own customers but must first complete the regulatory process.
Artificial intelligence and automation are growing hugely within the accounting and book-keeping sector, according to O'Dwyer.
"No longer does an accountant or book-keeper expect to manually input a purchase invoice or receipt into their accounting system, they fully expect now that these types of documents will be inputted and reconciled automatically," he said.
"The accountant's role is going to change. They're going to have more of an advisory role, helping businesses look at more profitable areas and help them change direction if they need to.
"The manual processing of book-keeping that was done by accountants is going to be done by them less and less because the machines are going to be doing it for you."
O'Dwyer said that some accountancy practices are embracing automation because it is allowing them to cut down on time spent on more mundane book-keeping tasks to focus on their business advisory role.
"Accountants are becoming less book-keepers and more management consultants that can look at the figures at the end of the month and explain what a business is doing right and what it is doing wrong," he said.
In the last year alone, Big Red Cloud's business has grown by 17pc, with forecasts for this year predicting growth over 25pc, said O'Dwyer. Last year, the company successfully raised €2.5m from alternative SME lender DunPort Capital. The agreement, which was put in place by AIB Corporate Finance, allows for a further €1.5m to be extended should the company wish to access it, he said.
The company is exploring overseas markets, with plans to initially bring the business to Malta and Cyprus.
Big Red Cloud is also working with a company in Ireland which has 300 franchises in the UK and which regularly comes across small businesses that currently do their accounts manually but who are looking for a way to do them electronically. O'Dwyer sees this as a potential first step into the UK market, he said.
"Within the next three months we will hopefully have verified the partnership in Ireland and hopefully we could begin rolling out the partnership in the UK in the third and fourth quarter of this year," he said.
Sunday Indo Business