Help your clients understand their current and future cash position with the new QuickBooks Cash Flow
Backed by the belief that everyone should have the opportunity to prosper, QuickBooks® empowers accounting professionals to provide small business clients with the tools and resources they need to make smarter, more informed decisions, especially when it comes to their financial health. One of the most recent advances in helping clients be more liquid is QuickBooks Cash Flow, a new offering that allows businesses to see their money-in/money-out accounts in one place, delivering insights and forecasts into their current and future cash position.
Cash flow has always been a common pain point for small business owners and is top of mind now more than ever. For the first time, QuickBooks Cash Flow provides a platform where business owners and accountants can see and manage their clients’ entire financial footprint in one place to be ready for the next pay run or prepare for times of uncertainty.
“The mismatch of working capital leads to challenges for small businesses, so QuickBooks Cash Flow is a tool that can centralize all cash management processes in one place,” explained Rob Daniel, head of product for QuickBooks Cash Flow. “With this, accountants can now have more strategic conversations with their clients to help them plan for the future, and educating clients on cash flow is yet another way accounting professionals can serve as strategic advisors and scale their impact.”
Machine learning powers QuickBooks Cash Flow and allows it to deliver customized insights, such as whether the client has enough money for payroll and working capital. With these insights, accounting professionals will be able to help steer their clients away from making mistakes in how they handle their cash.
Clients can currently find this feature in QuickBooks Mobile, and will soon see it in QuickBooks Online with the same features and services.
What the financial footprint looks like
QuickBooks Cash Flow is made up of four parts:
QuickBooks Cash1. QuickBooks Cash is an FDIC-insured business bank account that lives within QuickBooks Online. There are no monthly fees (ATM withdrawals and foreign transactions may include a fee2); instead, the client gets quick access to cash as soon as the money hits the account, and insights are delivered in the same place funds are accessible. QuickBooks Cash is the default location for where funds will arrive when a small business receives sales revenue through QuickBooks Payments, and users can easily move the funds directly to an external bank account if they so choose.
Envelopes. Envelopes represent a way for your clients to partition funds and separate money to save towards different goals. Money stays within the QuickBooks Cash account; however, when funds are moved into an Envelope, they are no longer spendable via the QuickBooks Debit Card (more on the card below) to protect against an accidental spend. And if your client decides that they no longer want to “hold” funds in an Envelope, the funds can easily and instantly be moved back into their QuickBooks Cash account. A business can add a name to the Envelope and then set goals, such as the amount and date for any purpose. For example, a client can create a “Payroll” Envelope that can only be used for payroll.
“With the Envelope feature, we’ve created a way for small businesses to be very conscious as to how they are spending their money,” says Daniel. “You can move money around in real time, but the feature is designed to provide discipline in how the business is spending their money. One customer even called an Envelope ‘You Never Know’ to cover unexpected spending. Even though the issue was a surprise expenditure, the customer was covered with the money set aside in the designated Envelope.”
QuickBooks Debit Card1. This is a free, physical debit card that enables a small business to access funds as soon as the money hits their QuickBooks Cash account. The card includes free ATM withdrawals (up to 4x/statement cycle) at 55,000 locations nationwide.
Cash Flow Planner. The Cash Flow Planner gives business owners a full view of their current and future cash positions so they can make the best decisions. Businesses can predict their cash flow up to 90 days out with accurate cash flow forecasts.
“The Planner feature projects out a business’ future cash flow position to provide a holistic picture for the small business that no other provider can offer,” said Daniel. “Through the use of machine learning to predict outcomes and decades of expertise in small business accounting, the Cash Flow Planner proactively alerts businesses to potential cash flow challenges and can provide suggestions on how to address them, helping business owners make the best decisions possible.”
Cash Flow Planner will give small businesses access to these insights by analyzing all financial inputs to predict the business’s cash flow over the next 90 days. Then, the Planner will proactively alert business owners when cash flow might become a concern. As the Planner continues to evolve, it will also be able to provide recommendations around how to navigate the situation. For example, the tool could predict and make an instant recommendation, such as, “You look like you will be short on your upcoming payroll; click here to get access to more capital.”
Looking ahead – What to expect in the near future
As with all its offerings, Intuit will work to continually improve QuickBooks Cash Flow, bringing new features to the table. In the near future, your clients can expect to see their money sooner with instant deposits/ACH funding, earn more benefits and rewards, and apply for a line of credit through the integration with QuickBooks Capital.
What versions of QuickBooks Online is this available in?
QuickBooks Cash Flow will be available in QuickBooks Online Simple Start, Essentials, Plus, and Advanced.
When will QuickBooks Cash become available?
It’s rolling out now to customers on iOS, and will be coming soon to web and Android.
Will the Cash Flow Planner apply to customers who don’t invoice in QuickBooks Online? Like restaurants or e-commerce?
Yes, the Planner will work for all customers, regardless of how they take payments. The only dependency is that the user connects at least one bank account to QuickBooks. The more visibility we have to the user’s financial picture (i.e., connection to bank account, open invoices, open bills, etc.), the more accurate the predictions.
Will we need to transfer from the QuickBooks Online bank account to our bank?
QuickBooks Cash will be the default account for new Payments customers, but it can be changed to an external account. If the default bank account for Payments is already set to an external account, funds will continue to flow directly to an external account as happens today; money will not sit in QuickBooks Cash or Envelopes.
With the QuickBooks Cash account and Envelopes, what will the reconciliation process look like?
Reconciliation is done on transactions from the QuickBooks Cash account. Envelopes only send/receive money from QuickBooks Cash, and is not a transacting account itself.
Will the QuickBooks Cash Envelopes setup impact the chart of accounts?
No. Money movement within QuickBooks Cash (ie., transferred to Envelopes) will not impact the chart of accounts.
Is there a way to automatically distribute funds to Envelopes based upon percentages?
Not currently, but we are working on the ability for users to set up rules to automatically partition funds that enter through QuickBooks Payments into specified Envelopes.
How do you spend money that has been apportioned to an Envelope?
Envelopes are directly tied to the QuickBooks Cash account and is an actual partitioning of funds. Thus, the funds are moved out of the QuickBooks Cash account and into an Envelope (ie., a sub-account that does not have an account number or routing number) for the desired purpose. To move money out of Envelopes, a user can 1) transfer the money back into the QuickBooks Cash account or 2) set the Envelope as the funding source for QuickBooks Payroll.
Can business owners use Envelopes with their other bank accounts?
No, Envelopes are only tied to their QuickBooks Cash account.
Why can’t a client have Envelopes and keep using their regular bank account?
QuickBooks Cash and Envelopes are one entity. So you have to apply for QuickBooks Cash to get access to Envelopes. To use the Envelopes (partition your money), the money has to actually reside in the Envelopes, which means it has to be moved out of your external bank. You can still maintain your regular bank account and move money between your Envelopes and the regular bank account if you wish.
Do Envelopes have to be reconciled like regular bank accounts do?
You will reconcile transactions in and out of the primary QuickBooks Cash account in the banking tab. Transactions among Envelopes will not show up.
Are Envelopes shown as sub-accounts to the main QuickBooks Cash Bank account?
Only the QuickBooks Cash account will show up, and it will be represented as the total balance of the primary account and all of the Envelopes.
Can users post to the Envelopes (like they can to a regular bank account)?
Users can transfer funds to an Envelope from an external account, but they will pass through the primary QuickBooks Cash account balance first.
If money is put into an Envelope, can it be reversed if not needed for the original purpose?
Yes, you can move it out of the Envelope at any time.
Do Envelopes show up on reports in QuickBooks Online?
No, just the QuickBooks Cash account.
QuickBooks Cash and Debit Card:
How do you deposit money into QuickBooks Cash?
You can ACH transfer funds from an external account, or accept payments through QuickBooks Payments (if QuickBooks Cash is set as the default account).
Can we deposit checks we receive into this account?
Not currently, but it is on our future roadmap.
Will the new QuickBooks bank account be available for international ATM withdrawals? How many ATM cards are available per account?
There is one debit card per account. Yes, you can withdraw funds from international ATMs. More information is available here.
Is QuickBooks Cash FDIC-insured?
Yes, the account is FDIC insured through Green Dot Bank.
Are there any fees associated with having a QuickBooks Cash Account?
- The deposit agreement can be found here.
- Four free in-network ATM withdrawals per each monthly billing cycle, $3 ATM withdrawal for out-of-network or after 4th free withdrawal of the month.
Does it pay interest?
Not currently, but that is something we’re exploring.
This is a bank account, not a line of credit?
Yes, it’s a bank account.
Is there any overdraft coverage, and if so, what are the fees?
There is no overdraft coverage.
Do we get monthly bank statements like we do with our regular banks?
Can we choose where customer payments go, or do they only go to QuickBooks Cash now?
You can choose to accept payments in a different external account.
Do we have to transfer money in to get it started?
Yes, or you can also fund the account by getting paid through an invoice and directing the payment to your QuickBooks Cash account.
How will my clients access their QuickBooks Cash account? Will it automatically show up as available inside their QuickBooks Online accounts?
Yes, it will show as part of the QuickBooks Online account on the left navigation bar as “Cash Flow.”
1 Subscription to QuickBooks Online is required. Banking services provided by and QuickBooks Visa® Debit Card is issued by Green Dot Bank, Member FDIC, pursuant to a license from Visa U.S.A. Inc. Visa is a registered trademark of Visa International Service Association. Green Dot is a registered trademark of Green Dot Corporation. QuickBooks products and services are not provided by Green Dot Bank.
2 4 free in-network ATM withdrawals per each monthly billing cycle, $3 ATM withdrawal for out-of-network or after 4th free withdrawal of the month; 3% fee per foreign transaction.