Xero and Plaid Team to Improve Small Business Banking Access

This partnership is aimed at ultimately tripling the number of  high-quality bank feeds available to customers in the U.S., the companies said in a news release Wednesday (July 16).

“For the many small businesses that form the backbone of local economies, access to community-focused finance providers is crucial, given the vast number of banks and credit unions nationwide,” Xero and Plaid said in the release.

“This partnership will significantly improve these business owners’ access to reliable bank connections, giving them a clearer, real-time view of their finances which, in turn, will empower them to make more informed decisions, supporting their growth, their employees, and the communities they serve.”

With this collaboration, Xero’s customers gain access to more than a thousand bank connections through Plaid’s network of U.S. financial institutions.

Beginning this year, Plaid will power an increasing portion of Xero’s U.S. bank feed sources, providing customers more dependable connections to their financial data, the release added.

“This partnership with Plaid is expected to supercharge bank connections. It will provide more robust integrations and higher-quality information from a wide range of financial institutions including smaller banks and credit unions,” said Vikram Grover, senior vice president for global partnerships for Xero.

“This will in turn make managing the finances a lot smoother, more precise and successful, as well as save valuable time for small business owners, accountants and bookkeepers.”

The partnership is happening as America’s small businesses are facing increasing struggles, as PYMNTS wrote Wednesday. The country’s Main Street businesses — defined as small, brick-and-mortar operations with annual revenues of under $10 million — are a key piece of the U.S. economy, paying 25% of the country’s wages.

The growth rate for these businesses has faded substantially since late 2024 through the first quarter of this year, lagging overall business growth despite a robust post-pandemic rebound.

“This slowdown is largely attributed to fewer new establishments and slower wage growth compared to larger firms, with restaurants and retail sectors particularly hard hit nationwide, as we found in our latest survey among small businesses,” PYMNTS wrote.

These businesses tend to outperform their larger peers, enjoying a strong recovery after the initial pandemic shock through mid-2022, thanks to federal aid and surging consumer demand.

But across the four quarters ending in Q1 2025, Main Street businesses grew at a markedly slower pace than the overall U.S. business index. That metric rose 3.6% while Main Street businesses managed only 2.4% growth.