Embedded finance in action: QuickBooks Checking
First launched in 2020 as QuickBooks Cash, QuickBooks Checking is a bank account designed for small businesses, offering seamless integration with the QuickBooks core accounting and payments products. The embedded finance proposition is made possible through a partnership with Banking-as-a-Service (BaaS) provider GreenDot Bank, which provides the underlying accounts, banking services and license.
Intuit, the company behind QuickBooks, designed QuickBooks Checking to help its existing customer base of 5 million small business users gain faster access to their money and better manage their cash flow. In under two years, more than 150,000 small businesses had signed up for a QuickBooks Checking account which has zero opening fees, no minimum balance requirements and no monthly maintenance fees.
In 2021, the company introduced an additional embedded finance proposition, Money by QuickBooks. This free app, designed for new businesses or freelancers, includes a bank account, the ability to get paid via requests and to pay other people or bills, and a debit card for any business spending. Unlike QuickBooks Checking, Money by QuickBooks users do not need to have an existing QuickBooks Online account, and the app does not integrate with Intuit’s other accounting and payments products. So this entry-level free business banking app can be used by new business owners who may not yet have a need for accounting software (but as their business grows and they do need it, who do you think they’ll think of first?!).
What’s in it for QuickBooks customers?
Seamless integration
With a NerdWallet rating of 5.0 (out of 5.0), QuickBooks Checking is rated higher than many traditional business bank accounts. What reviewers love about this proposition is the integration with the QuickBooks software suite. For instance, for QuickBooks Online users, opening a QuickBooks Cash account could help remove friction from some transactions and allow them to see cash flow projections. Or users receiving payments through QuickBooks Payments, could have their funds available in their checking account within minutes.
Envelopes
Another feature of note is Envelopes, which allows business owners to digitally partition their funds in separate savings envelopes for future planned or unexpected expenses. This helps them to avoid spending the funds before they intend to, earmarked for things like sales tax or payroll. One to watch is a Sales Tax Automation feature, coming soon, which will apply advanced machine learning to incoming sales payments to automatically sweep tax on sales away into a dedicated envelope.
Money in envelopes continues to earn interest, and at a rate of 1% across all balances, this outperforms most free business bank accounts, and competes with many traditional business accounts that come with a monthly fee. QuickBooks Checking has no minimum balance requirements and no monthly service fee.
Cash Flow Planner
Custom cash flow forecasting through the Cash Flow Planner feature delivers insights that helps business owners plan for the future and make smarter decisions. The forecast predicts cash flow 30 and 90 days out, drawing on machine learning and data analysis. The planner proactively alerts business owners when cash flow might become a concern and provides recommendations on how to navigate potential challenges.
QuickBooks Checking business bank account full feature list:
- Free to open
- No monthly fees or account minimums
- Access to Instant Deposit, without the added fee, if eligible
- High-yield interest on all balances
- Cash flow projections and insights
- Seamless integration with QuickBooks Payments and QuickBooks Payroll
- ACH transfers for no additional fee
- Withdraw funds at over 19,000 AllPoint ATMs
- Pay bills right from QuickBooks
- Free premium debit card with your company name (physical and virtual)
- FDIC insured up to $250,000
- Easy digital setup and customer support
QuickBooks Checking is only available to QuickBooks Online paid plan users. For business owners that do not subscribe to QuickBooks Online, Intuit offer an alternative account called Money by QuickBooks.
Money by QuickBooks
Money by QuickBooks is a free mobile app for new businesses or freelancers. It includes a mobile bank account, business Visa debit card, the ability to get paid via requests, pay other people or bills, and free same-day deposit.
It’s designed for new businesses or freelancers, who may not yet be at the point where they need accounting software, so Money by QuickBooks operates separately to the rest of the QuickBooks ecosystem. This is a separate entity and you can’t connect or share data, so if you have a QuickBooks account, its data won’t appear in Money by QuickBooks app or bank account and vice versa.
Although the praised integration with the QuickBooks suite doesn’t apply here, it can be used by anyone regardless of their existing QuickBooks relationship, provided they pass the account opening and identity verification process.
Like QuickBooks Checking, Money by QuickBooks charges no monthly fees or requires any minimum balances, however unlike QuickBooks Checking, Money does not pay interest on balances.
What’s in it for QuickBooks?
Quick proof points
- 150,000 businesses signed up to QuickBooks Checking in its first year
- 1/3 of QuickBooks Checking account customers are new subscribers to QuickBooks core accounting software
- Customers who use QuickBooks Checking are nearly 7x as active in using QuickBooks and ancillary services as users who haven’t opened checking accounts
New customer acquisition to core (paid) products
In order to sign up to a QuickBooks Checking account, business owners also need to have a paid QuickBooks Online subscription. Given the attractiveness of the Checking product alone, it’s likely that QuickBooks will acquire new customers to its core revenue-generating accounting package, who want to benefit from the bank account, which was recognised in Fast Company’s Innovation by Design Awards in 2020 and 2021 for leadership in fintech innovation.
According to the company, roughly two-thirds of the businesses opening QuickBooks Checking accounts (about 150,000 in late 2021) were existing customers. Which means the remainder (about 50,000) opened new subscriptions to QuickBooks in order to qualify for the checking accounts.
The Money by QuickBooks app also creates a training ground of new business owners who are already engaged with the company before they even have a need for accounting software. As their businesses grow, and the need for such software emerges, QuickBooks is perfectly positioned to swoop in and offer those services, and an upgraded business banking account to boot.
Increased stickiness within the ecosystem
Since January 2021, QuickBooks Checking’s active customer base has grown 4x and more than one-third of those customers are new small businesses operating for a year or less. Capturing so many businesses from the start of their journey puts Intuit in the perfect place to grow with their customers by introducing them to more of the QuickBooks ecosystem as more needs arise.
“QuickBooks Cash sits in the middle of the whole system. It is the glue that brings it all together.”
Rob Daniel
Director of Product Management for QuickBooks Money Offerings
Both QuickBooks Checking and Money by QuickBooks offer customers mostly free accounts (some ad hoc banking fees apply), so the barrier is pretty low for small businesses looking for their first business account. New businesses graduating through the QuickBooks ecosystem from the training ground of Money by QuickBooks, to QuickBooks Checking with increased integration into everything else that QuickBooks offers, become more engrained into the the world of QuickBooks through this journey.
Source: The Financial Brand, 2020
According to Intuit, the Checking proposition is instrumental in driving engagement to the wider QuickBooks ecosystem. Customers who use QuickBooks Checking are nearly seven times as active in using QuickBooks and ancillary services as users who haven’t opened checking accounts.
Insights to drive growth
Intuit’s intent is for QuickBooks Checking to become their customers’ primary business bank account, replacing traditional business banking relationships. Getting a fuller picture of those customers’ business financials and banking behaviours will on a micro level improve the identification of triggers to indicate needs for cross-selling additional QuickBooks products, and on a macro level provide broader insights into the small business customer as a whole.
The data generated by QuickBooks accounts across both banking propositions gives Intuit insights into how the small business market is changing.
All about that BaaS
The banking services accessed through QuickBooks Checking and Money by QuickBooks are provided by Green Dot Bank, Intuit’s BaaS provider.
This BaaS partnership allows Intuit to focus on designing seamless integration and experiences for its small business customer, and Green Dot to take care of the business and plumbing of banking.
“A banking solution that’s seamlessly integrated with the QuickBooks platform accelerates our ability to deliver tremendous benefits to small businesses and support them with complete visibility of and fast access to their money, all with total reliability.”
Rania Succar
Senior Vice President of QuickBooks Money Offerings
Through the Intuit partnership, Green Dot has been able to expand its BaaS offering from consumer banking to business banking, bolstered by another business banking partnership with Kabbage (subsequently acquired by American Express).
