Open The Way To A Better Deal

A delay in the rollout of the new banking regime gives small business owners more time to organise their finances

- Michelle Baltazar

Starting in July next year, small business owners will have a new ace up their sleeves to combat day-to-day cash flow problems. Under “open banking”, small business owners will be able to authorise their bank to share their banking data, such as receipts, payments and transactions, with approved financial institutions and comparison websites.

Small business owners can benefit from this in two ways: it will allow them to find out if their bank provides them with the best lending and cash rates and, if not, which institutions they can switch to.

Of course, this can be done today but not seamlessly. Most business owners don’t have the luxury of time to shop around or switch finance providers. But under open banking, they can move their loans from one provider to the next with a few clicks. There’s no running around getting forms together as data can be made available electronically on request.