The global account reconciliation software market size was valued at USD 2,365.09 million in 2021 and is anticipated to witness a compound annual growth rate (CAGR) of 14.60% from 2022 to 2030. The growth of the Account Reconciliation Software Market is driven by the increasing number of online payments and the growing use of automated banking systems. With this growth, businesses can expect to handle massive amounts of transactions and customers. The demand for these products is expected to be driven by the increasing need for improved error detection software in banks and other financial institutions.
Global Account Reconciliation Software Market: Regional Insights
The global account reconciliation software market is geographically segmented into North America, Europe, Asia Pacific, Latin America, and Middle East & Africa.
Among regions North America is expected to dominate the global account reconciliation software market over the forecast period. This growth can be attributed to strong presence of major industries, high adoption and development of account reconciliation software, increasing adoption of new technologies among banking and fintech sections for managing high volume of data created through online transactions in the region.
Asia Pacific is also anticipated to witness significant growth in the global account reconciliation software market over the forecast period, owing to the growing adoption of cloud-based account reconciliation software by fintech industries and SMEs for improving security features, growing focus of organizations on search & Implementation of solutions in order for their business to utilize intelligent techniques automating their accounting procedures and improving the customer experience.
Figure 1: Global Account Reconciliation Software Market Share (%), By Region, 2021
Global Account Reconciliation Software Market Drivers:
Growing rate of online transactions is a major driver expected to propel growth of the global account reconciliation software market over the forecast period. The reconciliation software demand is increasing all over the world with growing digitalization in several industries, among which retail industry has become one of the most agile segment in countries such as the United States. This is due to growing urbanization, increasing online transaction and government policies in the country. For instance, as per the EMarketer survey, in 2019, the overall expenditure on several e-commerce sites by consumers in the U.S. was US$ 589.92 billion.
Furthermore, the need for reconciliation management is growing all over the world, which is also expected to boost growth of the global account reconciliation software market during the forecast period. Due to rising adoption of real-time and digital payment systems by several organizations, the demand for reconciliation management is growing. The number of transactions continue to increase, as the online payment method is widely being adopted, this further creates the need for efficient management of data for retailers in order to grow their market share. With reconciliations software, retailers can efficiently manage large number of customers as well as their transaction volume. Thus, this factor is likely to support the market growth in the near future.
Global Account Reconciliation Software Market Opportunities:
The rise in use of AI and machine learning in recon software is expected to offer growth opportunities to players in the global account reconciliation software market during the forecast period. Artificial intelligence has become an important part of various recon software and their development. Manufacturers such as Fiserv, SAP SE, Oracle Corporation among others leverage AI and machine learning for developing their models of recon software, and this factor offers various growth opportunities in the market. For instance, in 2018, SAP SE announced the launch of its SAP cash application that enhances reconciliation process as well as cash flow management with the use of machine learning and AI techniques.
The adoption of reconciliation software is growing among SMEs, which is anticipated to create growth opportunities in the global account reconciliation software market over the forecast period. The growth of small and medium enterprises is significant in every developing market. These enterprises rely highly on recon software, as it offers a streamlined business process as well as integration of optimum resource allocation. As the SMEs are highly prone to fraudulent transactions, the use of recon software is high among them. Due to this increasing adoption of reconciliation software, the market is likely to witness strong growth.
|Base Year:||2021||Market Size in 2021:||US$ 2,365.09 Mn|
|Historical Data for:||2017 to 2020||Forecast Period:||2022 to 2030|
|Forecast Period 2022 to 2030 CAGR:||14.60%||2030 Value Projection:||US$ 7,771.44 Mn|
QuickBooks, AUTOREK, Oracle Corporation, and Broadridge.
|Restraints & Challenges:||
Global Account Reconciliation Software Market Trends:
Significant savings for SMEs with higher volume of needs of bank reconciliation a major trend in the global account reconciliation software market. Bank reconciliation is important; however, is complex and time-consuming process for both SMEs and large size enterprises. This is why, bank reconciliation software allow these enterprises to operate bank recs with higher accuracy in lesser time. Moreover, with the use of bank reconciliation, organizations can have a coherent picture of their cash status with fewer resources and lesser time. Thus, this trend is likely to continue in the market during the forecast period.
Furthermore, growing trend of adoption of online and digital payment methods is expected to propel growth of the global account reconciliation software market over the forecast period. Due to the adoption of online and digital payment, there is a significant growth in businesses and consumers. With this growth, the demand for automated reconciliations process in the end-users is increasing. For instance, as per the Banking Circle 2018 research on the Insurance industry of UK, manual reconciliation methods are utilized by 28% of the market, while 4% of the market relies on fully-automated reconciliation solutions, which eliminates human intervention.
Global Account Reconciliation Software Market Restraints:
The global account reconciliation software market is expected to face challenges. Factors such as concerns regarding security faced by enterprises are likely to hamper growth of the global account reconciliation software market over the forecast period. The number of cyberattacks on online transactions is increasing, as most of the software do not offer security features. Moreover, companies using recon software are facing several issues including slow data inputs, error prone inputs and inability of detecting major frauds. Furthermore, SMEs are relatively at high risk of cyberattacks and human errors, and these factors hamper growth of the market.
Another factor expected to hinder the market growth is unfavorable conditions resulting from Covid-19 pandemic. The virus outbreak in China, spread affected several industries. Due to the lockdown regulations by majority of the countries, the fintech and bank industries were closed down all over the world. This further impacted demand for recon software during the pandemic period. Which is why, this factor is likely to obstruct the account reconciliation software market growth during the forecast period.
Figure 2: Global Account Reconciliation Software Market Share (%), By Component, 2021
Global Account Reconciliation Software Market Segmentation:
The global account reconciliation software market report is segmented into Component, Deployment Mode, Enterprise Size, Reconciliation Type, Industry Vertical, and Geography.
Based on Component, the market is segmented into Software and Service. Out of which, Software is expected to dominate the global market over the forecast period and this is attributed to the rise in adoption of recon software solutions in retail industry, these organizations are adopting recon software for enhancing their operational efficiency and to provide assistance to employees towards better management of inventory.
Service segment is also expected to witness significant growth in the near future and this is owing to the growing adoption of services in end users, as it offers efficient functioning of recon software as well as platforms during the process. Moreover, high demand for cloud-based recon software services is creating growth opportunities for the market.
Based on Deployment Mode, the market is segmented into On-premise, Cloud. Out of which, On-premise segment is expected to dominate the global market over the forecast period and this is attributed to the growing demand. Due to the better data security as compared to cloud-based solutions, the adoption of On-premise deployment is growing and driving demand for the segment.
Cloud-based segment is also expected to witness significant growth in the near future and this is owing to the growing demand for cloud-based deployment in mid-size financial institutions, as these software don not involve high capital cost and require low maintenance. The growing adoption of these software in large and mid-size enterprises is driving growth of this segment.
Based on Enterprise Size, the market is segmented into Large Enterprise, Small & Medium Enterprises. Out of which, Large Enterprise is expected to dominate the global market over the forecast period and this is attributed to the rise in need for eliminating human errors and growing demand for cheaper, easier, and faster systems by enterprises is leading to high adoption of the software in large enterprises.
Small & Medium Enterprises segment is also expected to witness significant growth in the near future and this is owing to the rise in cloud-based recon software adoption in SMEs due to budget restraints. The demand for subscription-based, affordable recon software is high in SMEs, as cloud-based software are highly being deployed in these enterprises. This in turn is driving growth of this segment.
Based on Reconciliation Type, the market is segmented into Bank Reconciliation, Customer Reconciliation, Inter Company Reconciliation, and Others. Out of which, Bank Reconciliation is expected to dominate the global market over the forecast period and this is attributed to the rapid adoption of reconciliation processes in fintech and banking industry for ensuring cash records in order to offer convenient and easy process for cash accounts as well as bank statements.
Customer Reconciliation segment is also expected to witness significant growth in the near future and this is owing to the surging adoption of consumer reconciliation by industries such as e-commerce, retail and manufacturing.
Based on Industry Vertical, the market is segmented into BFSI, Manufacturing, Retail & E-Commerce, Healthcare, IT & Telecom, Energy & utilities, Government & Public Sector, and Others. Out of which, BFSI is expected to dominate the global market over the forecast period and this is attributed to the rise in number of transactions every day in financial and banking institution, as well as growing requirement for managing and controlling suspicious activities leading to growing use of reconciliation software.
Government & Public Sector segment is also expected to witness significant growth in the near future and this is owing to the growing rate of bribery, corruption and increasing theft of critical information and monetary value in public as well as government sectors. This is further leading to adoption of recon software in these sectors, which is driving growth of the segment.
Global Account Reconciliation Software Market: Key Developments
In March 2020, AutoRek entered into partnership with Nationwide in order to offer AutoRek clients platforms for cloud-based financial controls as well as data management for three years.
In January 2020, Broadridge Financial Solutions, Inc. announced the development of novel module of forecasting to help asset managers as well as other financial service providers for improving revenue reporting.
Global Account Reconciliation Software Market: Key Companies Insights
The global account reconciliation software market is highly competitive. This is attributed to continuous launch of new technologies due to ongoing R &D and efforts by value chain participants. Moreover, key players are adopting various business growth strategies in order to expand their presence on regional as well as global basis.
Some of the key players in the global account reconciliation software market are QuickBooks, AUTOREK, Oracle Corporation, and Broadridge.
The purpose of Account Reconciliation Software is to provide accurate, timely financial statements to a business. It allows user to automate the process and saves hours of time. It provides features like standardized templates, approval processes, review processes, and workflows for preparation.
Account reconciliation is an important process in any business. Incorrect transactions can harm a business's reputation and growth. The process is vital for detecting fraud and errors in financial records. With account reconciliation software, users can identify and correct these errors before they become big issues. This software also helps in ensuring the accuracy of financial statements.
The key advantage of Account Reconciliation Software is that it can automate the reconciliation process, saving user’s team time and enhancing the accuracy of the financial data. It will also eliminate the need for manual calculations. Manually reconciling account data is time-consuming and requires full-time employees. By automating this process, the team will be able to focus on other more important aspects of business management.
The increasing need for reconciliation management in organizations, growing deployment of account reconciliation software and the integration of artificial intelligence into reconciliation software are the factors fueling the account reconciliation software market's growth. Artificial intelligence (AI) is becoming an integral part of reconciliation software. This technology is boosting market growth by automating complicated transactions, thereby reducing the time and cost of human reconciliation.
However, factor such as lack of awareness regarding benefits of account reconciliation software, security concerns and unfavorable conditions resulting from COVID-19 pandemic are expected to hinder growth of the global account reconciliation software market over the forecast period.
Key features of the study: