Receipt capture may not be at the top of your agenda to streamline your bookkeeping…..but maybe it should be.

If you – or your bookkeeper – spend time entering data into your accounting system manually a receipt capture app could save you both time and money.

Receipt capture apps have been natural bedfellows for cloud accounting software throughout its relatively short evolutionary phase.

Companies like Receipt Bank and AutoEntry were quick to realise that they could automate purchase invoice entry in a similar way to how bank feeds automate bookkeeping entries for bank transactions.

The accounting app marketplaces reflect how this category of apps quickly rose to the top of the league table. Accounting firms have played a role here, too, with many offering a monthly subscription service that combines online bookkeeping with a receipt capture tool.

But over the past 12 months, we’ve seen the relationship move to a new level, with Sage acquiring AutoEntry and Xero announcing that Hubdoc (purchased in 2018) will be bundled in as part of core subscriptions from 18 March..

Apps that evolved as standalone receipt capture tools are having to rethink their core strategy and are starting to seek partnerships beyond the core accounting platforms, such as banks. 

Topping the add-on charts

Receipt capture tools took off with the mass adoption of smart devices. Users could snap a picture of an invoice or receipt with their smartphone and send it straight through to their accounting system, rather than having to stuff an envelope full of receipts and send it to their accountant or bookkeeper.

After the recent wave of acquisitions, Receipt Bank stands apart as the pre-eminent independent player in this market, and currently scans 2m receipts every week. Even as observers speculate whether it might be the target of a takeover bid from US giant Intuit, Receipt Bank is an attractive proposition that gained a new injection of $73m from investors.

Despite becoming part of Sage and Xero, Hubdoc and AutoEntry do not have Receipt Bank’s reach. But as their functionality is built into the underlying platforms, they are likely to increase their profile among small businesses.

When Xero announced that Hubdoc would be bundled in for free as part of their core subscriptions from March.this prompted a debate about whether it was worth continuing with subscriptions for data capture apps. 

The evolution of receipts

Data capture apps grew out of optical character recognition (OCR) technology that has been applied to scanned invoices and receipts since the early 2000s. In the not too distant future, this image scanning technology will be complimented by invoice fetch tools, or digital receipts such as Flux.

This relative newcomer generates fully itemised receipts, including line items and VAT data, from within banking apps and currently integrates with Barclays Launchpad, Starling and Monzo. 

Expanding partnerships

Receipt Bank still sees a huge opportunity for data capture apps. They remain on good terms with the cloud accounting providers, but emphasise its ability to pull data from other data sources that will benefit small businesses.

If you haven’t yet integrated a receipt capture app into your bookkeeping process why not try it out? As a Xero partner, we have had access to HubDoc’s Xero integration since the start of the year and with the vital importance of knowing your numbers anything that automates and speed up the bookkeeping process can only be welcome.

If you would like a free, no obligation, consultation about your cloud accounting and receipt capture options you can book a call with me here.

 

Noel Guilford