Otto Bank Rec: frequently asked questions

You'll need to:

• Set up your bank rules, or check you're happy with the ones you already have. We've made a quick guide to help you with this.
• Practices: Invite Otto to your Xero practice and assign the clients he should work with.
• Businesses: Invite Otto to the Xero organisations you want him to help with.

We'll help with setup on the call to make sure everything is set up correctly.

Bank rules are great for transactions where you don't get a bill, such as bank account fees, payment processing fees, and transfers. They are also helpful where the sales invoice or receipt has been generated outside of Xero, for platforms like Stripe. For companies with payroll, rules can normally be created for the wage payment, PAYE, and pension payments.

Read our quick guide for more ideas, as well as tips for making the most of rules and avoiding unexpected issues.

No. Otto runs on servers in the cloud, so you don't need to buy any new equipment, pay for the extra electricity, or be responsible for security updates.

You just pay based on the number of reconciliations Otto makes each month.

Otto is a Xero user the same as you and your staff. You can choose a profile photo and name to fit in with your practice image and your clients' expectations.

Otto's reconciliation features are identical. The only difference is how he is given access to the Xero accounts he needs to work with. Neither way is better or worse, we just tailor the steps depending on whether you are a business or a practice.

Billing works exactly the same way: you pay based on credits for correct reconciliations made.

Yes, absolutely. Otto is designed for businesses with established finance expertise. You need:

• Someone with solid understanding of bank reconciliation principles and Xero
• The expertise to properly configure and monitor automated reconciliation
• Internal finance capability (CFO, finance director, qualified accountant, or experienced bookkeeper)

Why this matters: Incorrect reconciliation setup can create accounting errors that require manual correction. Our support team can help with Otto's functionality, but we cannot provide general bookkeeping guidance.

Otto currently has limitations with these transaction types:

• Batch payments: a single payment covering several invoices or bills. Otto cannot choose which ones to apply the payment to.
• Foreign currency auto-conversion: where your bank converts the currency for you, such as a USD purchase converted to GBP. The amounts won't match exactly.
• Split payments: partial payments towards larger balances like loans or insurance premiums.

Otto can still help with your other reconciliation types, and you can handle these transactions manually. During your consultation, we'll assess whether Otto can provide enough value for your remaining reconciliation needs.

You can monitor Otto's performance through the With Otto portal:

• Daily reports: See exactly what Otto reconciled and what he skipped
• Confidence levels: Otto shows how confident he is about each match, and by default he needs to be at least 90% confident before he reconciles
• Feedback system: Tell Otto when he should have matched something he didn't, improving future performance
• Reconciliation history: Review all Otto's work with links back to the transactions in Xero

We recommend checking Otto's work weekly initially, then reducing frequency as you build confidence in his accuracy for your business patterns.

Otto appears as a Xero user in your organisation, similar to any team member you might invite. You can choose his profile photo and name to fit your business preferences.

Otto will show up in Xero's user activity logs and you'll see his reconciliation work in your transaction history, giving you full visibility of his actions.

We've put a lot of work into making sure Otto is as secure as possible. Please see our security and privacy page for more details. You can download a PDF from there to share with your clients if you want to explain the security measures that have been put in place.

Each practice has their own Otto, with a completely random password. There is no way that anyone else's Otto can access your clients, and vice versa.

2FA is enabled for all accounts for extra security.

Otto accesses your clients' Xero accounts the same as a person would, but he only looks at certain pages:

• Whilst reconciling, he will first visit the dashboard, then the bank accounts page, and then works through each reconciliation page for each bank account.
• Whilst saving previously reconciled transaction information for his training, Otto again starts at the dashboard and visits each bank account. This time he views the bank statements pages, and checks the transaction details and transaction pages to learn how transactions were reconciled against bills and invoices.

Statement and bill/invoice information is saved to train Otto, and also to record what he has reconciled so you can review this.

Training data is kept for no longer than 18 months from the date of the transaction on the bank statement.

The training data is turned into a machine learning (ML) model. The model stores the underlying data as several numbers for each transaction, and whether that is a match or a non-match.

Otto interacts with Xero through a Chrome-based web browser over HTTPS. The client data we save relates only to information you would see on the Xero bank reconciliation page. Data stored in the database for training and reporting is access-controlled, so it is only used for valid purposes. Passwords and 2FA codes are encrypted with a random key.

Yes. Any unused credits roll over to the next month and don't expire while your subscription is active, so you can handle varying workloads through the year.

You can choose how to handle additional reconciliation needs.

Fixed billing: Otto will pause reconciliation when your credits run out and resume automatically when your plan renews. This ensures you never exceed your planned budget.

Fixed billing with limit: This works the same as fixed billing, but you decide how many extra credits Otto can use before he stops.

Uncapped billing: Otto will continue reconciling and charge any extra credits at your plan's standard rate at the end of the month. This keeps your workflow smooth during busy periods.

You get complete visibility of credit usage with all options, and you can change your preference at any time through your practice settings.

SmartMatch is how Otto decides what to reconcile. Rather than working out whether a payment on the bank statement relates to an invoice or bill in Xero from the payee and reference details alone, SmartMatch looks at 12 months of previous reconciliations for each of your clients to learn how you have reconciled in the past.

With that data, Otto can find patterns in those past reconciliations, which reduces mistakes and lets him take on trickier matches.

For each green match on the bank reconciliation page, Otto will use this training data to decide whether it's a match or non-match, and a confidence level from 0 to 100%. For example, he could be 90% sure something is not a match, or 50% sure something is a match. By default, we require Otto to be at least 90% sure the match is correct before he will reconcile.

Our primary goal with Otto is that he should not make an incorrect match. We don't want you to have to constantly check what he has done because you can't trust he's done the right thing. SmartMatch allows us to make sure Otto is really unlikely to do the wrong thing.

Sometimes SmartMatch will mean Otto is not as confident about a match as you might expect. This is more likely if the information on the bank statement is confusing: for example, where the description runs the payee, reference, date, and address together, or where the payee is completely blank.

SmartMatch needs a certain amount of previous reconciliation data to train with, around 100 matches in our testing. Accuracy will be higher with more examples, but Otto is trained to skip reconciliations he is not sure of, so you should not see incorrect reconciliations even with a low volume of training data.

We are constantly working to improve how accurate Otto's work is, and you will automatically benefit from these improvements.

GuidedMatch lets you tell Otto to reconcile something when he isn't confident enough to do that himself.

When you tell Otto he should have matched a transaction he didn't reconcile, he will see your feedback the next day and reconcile that transaction. There's no cost for GuidedMatch, so you give Otto the feedback he needs to improve and you don't have to go into Xero to reconcile the transaction yourself.

GuidedMatch is separate from the fortnightly training, so Otto isn't learning from what you have told him at this point. He trusts your decision and follows it.

He doesn't. He will reconcile any bank rules you have set up, from day one. You just need to make sure that the rules only match what you want them to, and that they don't require any information to be entered during the reconciliation.

SmartMatch works using information about previous reconciliations, so you don't need to do anything there. We take care of it all.

However, giving feedback in the portal is a key part of making sure Otto understands what should and should not be reconciled so we recommend you spend a little bit of time each week letting him know how accurate his decisions have been so he will improve next time he is retrained.

No. We're about matching the correct transactions and avoiding mistakes, not clicking the OK button as many times as possible. We would rather skip some possible matches than match something incorrectly.

Otto will only reconcile a green match when he is at least 90% confident the statement and bill are a match.

Otto currently skips these types of green matches:

• Batch payments: a single payment that needs to be applied to more than one invoice.
• Part payments: often used for instalments, where you split the invoice or bill.
• Different currencies: we haven't taught Otto how to find currency exchange rates, so the statement and the bill need to be in the same currency.
• Payment made before issue date: we think a human should use their judgement to decide whether this type of match should be reconciled.

You can. You decide which features are enabled for each of your clients.

Otto is automatically retrained every fortnight to keep his knowledge up to date.

The training process uses new reconciliation data from Xero as well as any feedback you have provided in the portal.

SmartMatch is how Otto decides what to reconcile. Rather than working out whether a payment on the bank statement relates to an invoice or bill in Xero from the payee and reference details alone, SmartMatch looks at 12 months of previous reconciliations for each of your clients to learn how you have reconciled in the past.

With that data, Otto can find patterns in those past reconciliations, which reduces mistakes and lets him take on trickier matches.

For each green match on the bank reconciliation page, Otto will use this training data to decide whether it's a match or non-match, and a confidence level from 0 to 100%. For example, he could be 90% sure something is not a match, or 50% sure something is a match. By default, we require Otto to be at least 90% sure the match is correct before he will reconcile.

Our primary goal with Otto is that he should not make an incorrect match. We don't want you to have to constantly check what he has done because you can't trust he's done the right thing. SmartMatch allows us to make sure Otto is really unlikely to do the wrong thing.

Sometimes SmartMatch will mean Otto is not as confident about a match as you might expect. This is more likely if the information on the bank statement is confusing: for example, where the description runs the payee, reference, date, and address together, or where the payee is completely blank.

SmartMatch needs a certain amount of previous reconciliation data to train with, around 100 matches in our testing. Accuracy will be higher with more examples, but Otto is trained to skip reconciliations he is not sure of, so you should not see incorrect reconciliations even with a low volume of training data.

We are constantly working to improve how accurate Otto's work is, and you will automatically benefit from these improvements.

He doesn't. He will reconcile any bank rules you have set up, from day one. You just need to make sure that the rules only match what you want them to, and that they don't require any information to be entered during the reconciliation.

SmartMatch works using information about previous reconciliations, so you don't need to do anything there. We take care of it all.

However, giving feedback in the portal is a key part of making sure Otto understands what should and should not be reconciled so we recommend you spend a little bit of time each week letting him know how accurate his decisions have been so he will improve next time he is retrained.

No. We're about matching the correct transactions and avoiding mistakes, not clicking the OK button as many times as possible. We would rather skip some possible matches than match something incorrectly.

Otto will only reconcile a green match when he is at least 90% confident the statement and bill are a match.

Otto currently skips these types of green matches:

• Batch payments: a single payment that needs to be applied to more than one invoice.
• Part payments: often used for instalments, where you split the invoice or bill.
• Different currencies: we haven't taught Otto how to find currency exchange rates, so the statement and the bill need to be in the same currency.
• Payment made before issue date: we think a human should use their judgement to decide whether this type of match should be reconciled.

You can. You decide which features are enabled for each of your clients.

Otto is automatically retrained every fortnight to keep his knowledge up to date.

The training process uses new reconciliation data from Xero as well as any feedback you have provided in the portal.

GuidedMatch lets you tell Otto to reconcile something when he isn't confident enough to do that himself.

When you tell Otto he should have matched a transaction he didn't reconcile, he will see your feedback the next day and reconcile that transaction. There's no cost for GuidedMatch, so you give Otto the feedback he needs to improve and you don't have to go into Xero to reconcile the transaction yourself.

GuidedMatch is separate from the fortnightly training, so Otto isn't learning from what you have told him at this point. He trusts your decision and follows it.

Otto records status messages so we can see that his work is running as expected. Any issues will be logged for further investigation. Errors are escalated so they can be reviewed by the developer, in case a fix or other change needs to be made.

We also monitor resource usage to ensure that reconciliations start and end within the one-hour timeslot you have chosen.