Welcome to the Mclowd Community Newsletter.

Xinja will be able to benefit from the plunging costs of technology. It is currently assessing potential cloud and core banking providers. A core banking system can be rented these days for less than $20,000 per month.
Xinja in bid to crack open banking sector, AFR 22 May 2017


Notwithstanding the fact that I work with a globally-dispersed Team, I have not paid for an international phone call in many years (thanks to options such as Skype and now WhatsApp).

The ‘zero-rated’ nature of these alternatives is important, because it severely limits the ability of companies such as Telstra and Optus to create any form of ‘perceived value’ in relation to those calls.

In the context of the above quote, how do you go on charging $100K per month for a core banking system when someone else will do it for less than $20K? Presuming (anything like) functional equivalence, $80K in perceived value has simply evaporated into thin air.

SMSF Accounting Update

As the accounting software continues to improve SMSF assets under administration within the Community are approaching A$1 billion, and growing steadily.

Based on collaboration with a number of key practitioner users, Mclowd has now enabled the ability to automatically allocate transactions to a ‘bank clearing account’.

Using a suspense account in this manner (whether from an automated feed or manual import) means the bank side of the ledger is generated automatically.

The other side of the ledger has also been simplified with the introduction of an autosave function. While this feature is currently only designed for basic income and expense transactions, over time it will be refined to include more rules / auto matching. This is all about speeding up transaction processing in a manner very similar to incumbent platforms.

Other recent improvements include:

  • Online activation for bank data feeds from Westpac and ANZ
  • The ability to export bank transaction data as a text file


Incumbent platform providers in the SMSF accounting space announce improvements to their offerings (the ‘actual value’ of their products) on a daily basis. These are outcomes for which they can be rightly proud.

However, while all this activity is going on an SMSF practitioner registers with Mclowd on average every 48 hours.

These practitioners are not seeking out Mclowd because of our marketing budget (there isn’t one), or functionality (Mclowd has yet to deliver equivalence).

The fact that they seek out Mclowd is due to one simple reason:

Irrespective of actual value, their perceived value of those products has fallen below the price being charged.

Once perceived value falls below price, migration behaviour inevitably follows (whether it is software, energy, accomodation, transport or politicians).

We live in a world where you can start a bank with the microeconomic equivalent of loose change. In this highly deflationary context there is only one factor that will determine longevity:

The ability to operate at a price point that is less than perceived value

And that is becoming increasingly hard to do.

No matter how hard you are running.


Ashley Porter
Managing Director
Mclowd Pty Ltd