The hallmark of QBO that gives it such great return on investment is its Banking Feed. Your company will save several hours a week of clerical work by using the Bank Feed feature.
The Banking Feed connects to a company’s banking websites for their checking & savings accounts as well as credit cards. It becomes a central clearinghouse to see what transactions have cleared the bank that day.
By using it as their focal point, your clients will know what work they need to do in their QuickBooks to stay up to date. Any transactions listed in this feature need to be either Matched to existing transactions, or Added to the company books.
The goal is to see zero transactions under each card.
This marvelous automation feature is found under Banking on the left sidebar. Finish each day here, as I explained in the section on Putting the “Quick” in QuickBooks of my very first article for Insightful Accountant titled, 'Why Bookkeeping is Important'.
While it still needs maintenance to import cleanly, the Banking Feed automates the time-consuming task of manually entering every single debit card and credit card charge.
It also helps bookkeepers discover transactions they missed, or ones created manually that never hit the bank.
In the sections below, I cover best practices for managing the Banking Feed. Most important is knowing which transactions can just be entered from here, and which ones that still need to be created through regular workflows.
Setting Up Banking Feeds
Banking Feeds work in one of two ways:
- Direct Connect. A direct connection to the business’s bank or credit card company automatically “sucks in” all that day’s transactions for approval. Some banks charge for this service, but it works with almost all bank accounts for free.
Connect_Bank-feeds
- Web Connect. Go to the business’s bank website and download the month’s transactions, then import them into QuickBooks Online. This service is always free, but is more labor-intensive.
To get set up:
- Click on the green Add Account button,
- Choose Your Bank.
- Log in with your client’s username and password (note: bookkeeper read-only access logins frequently don’t work).
- Map the business bank accounts to the accounts in QBO. Skip all personal accounts. (One example of account selection is shown below.)
- Choose how far back you would like to import. [Note: If you’re converting an existing file, you may just need the last month. If you’re starting a new file, you may import a year or more. If you need to go back further, go to the business’s bank website and download a .qbo, .ofx, or .csv export of the missing transactions. Use the drop-down arrow on the Update button to do a File Import.
- Repeat these steps for all company bank accounts and credit cards.
bank feeds with tokens authorization
PEBCAK! On new QBO files, the bank connection will create an already-reconciled Opening Balance Equity entry. Sometimes this is helpful, but most times it needs to be edited or deleted. Find it in the Bank Register to adjust it or remove it.
Bringing It All Together
Once you try the banking feed feature, you will never go back! Banking in QuickBooks Online is far more robust than it is in QuickBooks Desktop. You know just how precious even an extra couple of hours can be. Adopting QBO’s Banking Feeds will transform your bookkeeping practice from data entry to efficiency, giving you the opportunity to take on more clients, or provide more advanced services.
Speaking of opportunities, I’ve got another one for you! Would you like to see the Banking Center in action? My 2-hour Banking Feed & Reconciling class details how to make the most of the artificial intelligence used by Banking. Or check out my QBOA Tips and Tricks course or join my Mentorship Membership Program.
In my next article, we’ll get into the nitty-gritty on using the Banking Feed, including finding matches, adding simple expenses, and making item purchases.
By the way, I also have two upcoming webinars co-sponsored by Insightful Accountant:
- The first is QBO’s 1099 Contractor Tools which is being held January 7, 2020 at 12:00 p.m. Eastern Time, you can register for this webinar here, or get more details here.
- The second is QBO 101: Customers and A/R being held on January 9, 2020 at 12:00 p.m. Eastern Time, you can register for this webinar here, or get more details at this website.