BankBazaar Singapore – January 30, 2018
SINGAPORE: Recently, DBS and Xero had announced the successful development of an API-based banking solution that allows MSME customers and start-ups to send bill payment details and other banking transactions directly from their Xero accounts to their DBS Ideal internet-banking account.
This means that customers in Singapore using DBS Ideal and Xero won’t have to manually enter the bill payment information twice for every transaction – once on Xero for accounting and again on DBS Ideal for payment.
According to data cited in a DBS news release, one in every three or 33% of the SMEs (small and medium-sized enterprises) in Singapore face issues with management of their cash flows. DBS and Xero believe that this new development, introduced for the first time in the industry, will help their customers maintain a better track of the cash flow.
It is important to note in this context that SMEs form almost 99% of all companies operating in Singapore and provide livelihood to almost 80% of the population. With rising operational challenges which include a surge in manpower costs and trickier operational climate, being able to reduce human involvement in banking-transaction entry and reconciliation can reduce costly errors.
According to another DBS news release published in the middle of 2017, businesses in Singapore spent 15.5 hours on an average per month to import bills and invoices from their system to their banking software, leading to a huge loss of productivity. About 17% of those surveyed claimed that this was the single largest financial challenge they faced.
Coupled with rapidly changing market dynamics and steeper hiring challenges, the operational costs were becoming untenable. With this API-driven banking solution, any Xero customer with access to DBS banking feed can reconcile their payments received and made on a real-time basis.
With a better understanding of their financial position, companies would be able to make quick business decisions and informed choices to access debt capital for daily operations and business expansions.
The latest technology update will help cash flow management through easier invoicing leading to cost and time minimisation. This will also allow businesses to use their resources optimally and spend more time in understanding customer needs rather than spending time on unproductive accounting.
Joyce Tee, Group Head for SME Banking at DBS, feels that this solution will help customers devote more time to grow their business. According to Alex Campbell, MD for Asia at Xero, small businesses can use this digital solution to drive growth through better management of cash flow and easy access to capital.
This digital bank feed is available to all DBS business customers who have subscribed to Xero. It is hoped that this API-based integration can solve many of the financial management challenges that small businesses in Singapore encounter on a daily basis.