Customer: ClearBooks

The administrative burden of running a small business can feel overwhelming. This is especially true for all the bootstrapped sole proprietors and business owners who launched their business to capitalize on their strengths—not toil in endless accounting, paperwork and tax compliance, which they likely don’t enjoy or excel at.

Clear Books aims to ease this burden by providing simple online accounting software for microbusinesses. Since 2008, the London-based company has helped more than 10,000 small businesses take control of their finances.

Key to the platform are bank feeds, which import users’ financial transactions. Before Clear Books integrated with Plaid, this was done through screen scraping, a practice which involves copying data from one application for use in another. But with the UK prohibiting the practice in early 2020, Clear Books needed a new way to enable users to share their financial data.

“We also wanted a data provider who could set us up for the long term by providing bank feeds from a wider range of banks,” says David Carr, CFO and Head of Product at Clear Books. That’s when Clear Books turned to Plaid.


Connecting with neobanks

When businesses sign up for Clear Books, they’re given the option to connect their financial accounts with Plaid. To do so, they simply select their financial institution from a list and enter the login and password associated with their accounts. Plaid connects to over 11,000 financial institutions around the world— often in a matter of seconds.

Once users connect their accounts, their transactions are fed into Clear Books four times a day, giving business owners a clear view of their finances. This helps streamline things like invoicing, purchase tracking, and financial reporting— allowing resource-strapped entrepreneurs to spend more time on strategic priorities, and less time managing paperwork.

Of course, users can still manually enter transactions, but it’s time-consuming.

“The difference is night and day,” explains Carr. “With Plaid, business owners can wake up in the morning and get a clear, current, and accurate view of their finances.”

Providing this streamlined user experience hinges on good bank coverage. In the UK, many microbusinesses rely on neobanks, which excel at servicing these smaller companies. Clear Books’ previous financial data provider didn’t connect with neobanks, forcing many of their users to manually upload their financials. The user experience wasn’t great.

With Plaid, however, Clear Books offers connectivity with the UK’s top four neobanks.

“Year on year, we saw a 51% uplift in customers using bank feeds because of Plaid. We also saw a 34% increase in active feeds,” says Carr.


A smooth path to compliance

Another major reason for Clear Book’s switch to Plaid was Open Banking. Forced to comply with the new laws, Clear Books sought an experienced data aggregator to help them replace their screen scraping practices with compliant bank feeds.

“We needed to have the utmost confidence that our data provider was compliant,” says Carr. “It was critical that Plaid be on their game—and they were.”

The transition to Open Banking challenged many across the UK financial sector. For Clear Books, a company which strives to provide swift customer support, helping users troubleshoot their bank-connection issues meant Plaid would need to provide fast support as well.

“With our previous provider, we’d submit tickets and sometimes wouldn’t hear back,” explains Carr. “Plaid typically responds to our support tickets within 1-2 hours, which helps us provide excellent support to our customers.”


Quick integration

When Clear Books reached out to Plaid, the clock was ticking on compliance deadlines—and Clear Books needed a quick solution. From initial contact to production, the Plaid integration took only six weeks.

Carr says good documentation and technical support from Plaid helped ensure a successful integration. Now, with their new bank feeds in place, the company has been able to refocus on their mission of becoming the easiest bookkeeping tool for microbusinesses.

“Working with Plaid has been great,” concludes Carr. “We recommend them without hesitation.”