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Since Ventureburn reported on Xero’s partnership with Sasfin Bank, we had a chance to speak to the MD for Xero’s operations across EMEA, Gary Turner, about the deal and more.
After announcing their partnership at a recent roadshow, the team over at Xero have been hard at work in keeping that momentum going.
“What we do when we partner with banks has never existed before, this isn’t about the bank selling or recommending Xero, or becoming some kind of sales channel for Xero,” said Turner.
“I know the banks in SA, the UK and other countries have had bank referrals where they sort of gave you a discount for referrals and we don’t do that,” he continued.
Turner felt strongly toward this, saying that banks shouldn’t be the ones giving advice as they don’t necessarily understand small businesses.
He stressed his point, saying that no matter who you speak to at a bank they aren’t going to understand your small business let alone recommend a tool for you to utilise.
“What we think is healthy, is making the life of the business owner easier. So we invest in tools that will enable them to run their business more effectively,” said Turner.
One of the most important things a bank can do for startups is to give them a data feed on their latest transactions which allows them to run their businesses more effectively, he mentioned.
Challenges facing small businesses
A big challenge that small businesses face, according to Turner, is the time they spend on just trying to get paid or chasing payments.
“Anything that we can do to give them more confidence and visibility, we think, makes our accounting product more attractive to them, so that way we’ll win more customers.”
Another challenge faced by small businesses is the traditional approaches banks take toward them. Turner goes on to mention that the traditional ways in which banks help SMEs isn’t really helping at all.
“But, something as simple as a transactional feed means that every morning that small business owner goes out into the day with confidence knowing what their financial position is.”
Gary Turner, of Xero, says the firm is targeting the traditional accounting systems for small businesses
“And that’s infinitely more useful to them than that 5K overdraft extension. It sounds like it should be more sophisticated than that, but it isn’t, small business is all about managing your cash.”
Traditional systems threaten SMEs
But, besides the traditional challenges, there’s another threat that looms… traditional systems and our loyalty to them.
“We were born in the cloud, we don’t have a legacy of old software, we don’t have a legacy of delivering support services around difficult-to-use products, those businesses have been around for 30 years and have done a good job with that previous generation, but the Windows generation is disappearing pretty soon,” said Turner.
“I think software for this modern world is very different from the software from the old world and so what our customers tell us is that they love the innovation we bring because we started with a blank sheet of paper.”
The old adage ‘why re-invent the wheel’ comes to mind. Well, if you don’t re-invent how do you plan to innovate? That’s the thinking, according to Turner.
“We have nothing to protect, we don’t have a legacy to try and hang on to. We’re always thinking how we can make things better for our customers,” said Turner.
So, is Sasfin the only bank in Xero’s sights to re-invent the wheel? Probably not, as Turner explains.
“I can’t disclose specifics of that, but it’s safe to say that we’re talking to all the people you’d expect us to be talking to.”