Letting agents will for the first time be able to use Open Banking to process payments more efficiently, following a decision by the Financial Conduct Authority.

The FCA has approved industry software supplier agentOS to offer Open Banking, which  provides a secure way for businesses and consumers to allow software providers access to their financial information. 

This in turn will allow agents to automate payments and, amongst other things, help agents reduce the amount of out of hours payment work they are having to do.

Many letting agency owners currently have to spend increasing time handling rent payments and contractors’ bills as their portfolios have expanded.

“We see what times of day agents are doing additional payment administration work. They are either getting up really early or, if the day gets away from them, logging in at 10pm or 11pm to manually manage payments” says agentOS managing director Glyn Trott. 

“This is particularly the case for owners of independent agencies who like to keep in control of finances, but we’ve also seen the founders of larger agencies – or someone senior who is highly trusted – doing the same.”

He says the automation Open Banking allows means agents will no longer have to manually manage payments, while the overall process is significantly faster.

“Not only will this save time, but agents can pay their landlords quicker, while receiving their fees faster and improving cash flow” adds Trott.

According to agentOS, agents who use its Open Banking solution will benefit from a more seamless online banking solution.

“Most agents currently use BACS to process payments. However, it is quite an old and slow system which can take up to three days to process a payment if it’s made to another bank” Trott explains.

“Online banking is quicker but requires agents to process payments manually every day. Open Banking is changing the landscape and allows agents to benefit from automated online banking, which is vastly superior to BACS.”

Trott says the advantage of his system goes beyond simply saving time. 

“It helps agents to identify who money belongs to and when it’s due. It connects the start and end of the process and automation means you no longer need people to process the payments” he explains.

Trott says that while many mortgage companies already use Open Banking and it has been trialled by some tenant referencing firms, agentOS is at the forefront when it comes to agency software suppliers embracing this new wave of financial technology.