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SMSF bank account verification facility pending

Australian software company eAuthority is set to launch a beta release of its SMSF bank account verification service to make rollovers of retirement savings balances from Australian Prudential Regulation Authority (APRA)-regulated funds easier.

Access to the facility is expected on 26 April, with eAuthority general manager Grant Augustin saying he came across the specific issue in relation to verifying bank accounts four weeks ago, with SuperStream providers highlighting the weakness in the process.

“We have a close relationship with banks so we developed a model where trustees can get confirmation that a bank account is an SMSF bank account, and we’ve been working on this model with a type of release that we’re testing with a few users at the moment,” Augustin told selfmanagedsuper.

“Basically the gap it will fill in the market is the ability for SMSF holders to provide confirmation that a bank account is an SMSF bank account, so what we’re trying to look at, and what I think is the key to the industry, is something that is automated, that is not manual, and scalable.

“You can contact the bank and the bank can get something to you to say it is an SMSF bank account, but doing that for 400,000-odd SMSFs and not getting the audit certificates out within a couple of weeks [is problematic], so we’re trying to do it online.”

EAuthority had worked closely with two financial institutions and was aiming to have them signed up by next month’s beta release, he said.

“All the banks have told us that if this is something acceptable for the SMSF market, they’re definitely interested in it and will support it,” he said.

“The process is one step closer to make it fully automated with the banks and the last step is to just do a review on the legal side of things and make sure there are no risks to the banks or their customers, but that should all be ticked off.

“For this to work, particularly with the institutions, it’s got to be simple.”

The company was also trying to manage the cost of the offering, he said.

“We don’t want it to be a barrier to people being able to use the service,” he said.

“But I can’t see there being an issue with an APRA-regulated fund using it if everything’s been ticked off.”

EAuthority was founded in 2012 and specialises in software solutions for the financial services and accounting industries, allowing individuals, companies, trusts and SMSFs to complete and lodge forms securely online with a financial institution.

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