Xero has teamed up with Plaid, a leading fintech company, to enhance U.S. bank integration and streamline the connection between business bank accounts and Xero.

The partnership aims to assist businesses in saving time and gaining a clearer understanding of their financial status, reflecting Xero’s dedication to providing intuitive and valuable tools for small and medium-sized enterprises (SMEs) as well as accounting practices. This collaboration helps companies navigate the ever-changing financial landscape more effectively.

Enhanced Bank Account Solutions

This alliance brings several benefits to Xero’s customers, including a greater number of available bank feeds—triple the amount currently offered. This expansion allows users to connect with more financial institutions in the U.S., such as smaller banks and credit unions.

Moreover, Plaid’s technology will support a portion of Xero’s bank feeds over the next 12 months, promising improved data accuracy and enhanced insights. This is crucial for better decision-making and understanding cash flow.

Security is a key focus with both companies transitioning to more reliable direct bank feeds using OAuth. OAuth is an open standard protocol that enables users to grant third-party applications access to their resources on another service without sharing usernames or passwords. By utilizing tokens from bank systems, OAuth offers a secure alternative to traditional methods.

Xero plans to gradually migrate its existing feeds to OAuth equivalents where possible, ensuring better protection and stability of financial data. The rollout will occur in phases, starting late 2025, with clear instructions provided to users throughout the transition process.