What is a bank connection?

A service firm sends dozens of invoices each month and pays its own suppliers. Without a link, someone downloads a file from internet banking every week and loads it into the books. That works until somebody forgets, or loads the same file twice.

With a connection, the transactions arrive on their own. The real benefit is what follows: the software can match a payment to the right open item. That matching is called payment matching and goes faster, with fewer slips, when the bank data is already there.

What goes wrong without it? You notice late that a customer has paid, so you chase someone who has already settled. Or a payment sits on a suspense account because nobody knows what it belongs to. The month-end close also slips when the bank is brought up to date late.

A few things to look at. Check that your bank and your type of account are supported, because not every combination works equally well. See how duplicate lines are prevented and how often transactions are fetched. And look at how the counterparty's account number, the IBAN, is stored, because much of the automatic matching depends on it.

A connection helps the administration but does not replace control. Who may approve payments, and how you set that up, is something to settle with your bookkeeper. Also think about the day the link stops working: who notices that no new transactions are arriving, and who then processes them by hand? Agree that beforehand, so that an outage does not quietly turn into a pile of backlog.