Your accounting system doesn't really integrate with your bank, right? I know. Mine doesn't either.

Sure, there are "integrations" available. Your bank likely offers a service where you download files and then import them into your accounting system, or in reverse. But, like me, you've probably found it to be underwhelming. You're not alone. Few of my firm's 600-plus small business clients do this and for many reasons that you probably recognize. The process is cumbersome. The software changes. The software breaks. The software needs tech support. The software takes too long to setup. It's beyond the capabilities of a typical bookkeeper. And of course there are the inevitable security concerns.

This week, it all just changed. Something huge happened. For the first time ever, a big bank (Wells Fargo) is enabling an accounting application (Xero) to seamlessly access its banking data. And this is the first step to something much bigger.

According to this report:

The San Francisco-based bank compares the new data-sharing method to how some websites, such as Spotify or Airbnb, let users log in with Facebook. The platform eliminates the need for Xero customers to share their Wells Fargo usernames and passwords as well as the need for the software firm to store them in order to retrieve Wells Fargo account data. "The new method of data sharing is driven by an API (application programming interface), and creates a secure, tokenized 'handshake' between the companies' servers," Wells Fargo writes.

A "handshake"? That's all it took?

I bet, like most of my clients, you've already moved toward online banking. Just a few years ago you were cutting checks. Now you're having your bank cut checks for you and you're controlling this through its cloud based software. Or you've taken steps to setup direct payments with your largest suppliers. The majority of my clients are receiving payments by credit card, by wire transfers, or directly from their customers. And yet there's still been a disconnect with their accounting systems. Until now.

Did you know that banks were actually the very first cloud service providers? Think about it: Even 50 years ago most people weren't piling up cash in their homes, unless they were waiting for the apocalypse or worked for the mafia. They gave their money to the bank and the bank confirmed their balance in a monthly printed statement. As far back as the '90's you were then able to get that same information on the internet (psst--that's also "the cloud"). Your cash was there ... somewhere.

Banks were in the cloud. But unfortunately, accounting systems were not. They were installed on millions of desktop PCs around the world. So integrating customers' banking information with their accounting systems was understandably a sketchy and unreliable process.

And now that's all changed.

Xero is a leading cloud-based accounting system. So is QuickBooks online. My company sells them both. And many other competitors are appearing on the scene. Now that data is stored in what amounts to one giant server farm with a consistent set of protocols and structure, rather than millions of disparate computers in peoples' offices and bedrooms, it's easier for one cloud-based application to talk to another.

That's why a visitor to your website can automatically like your Facebook page. Or Uber lets you check in to a Hilton hotel on your way from the airport. Or how OpenTable lets you setup payment for your meal at the restaurant you just reserved. Spotify lets you share your playlist with your Facebook friends. And services like IFTTT can turn up your thermostat if the local temperature on falls below 50 degrees and make your lights blink on and off every time ESPN reports that the Phillies hit a home run (in other words, about once a month). Xero, like other great cloud-based applications, shares its data seamlessly with popular add-ons for CRM, accounts payable management, and point-of-sale systems. Because they're all in the cloud, they're more easily integrated.

This is only the beginning. The door is open. More banks--your bank--will soon be doing the same. You will be seamlessly sharing your accounting data with your bank and your banking data with your accounting system as easily as you're synching bookmarks between your smartphone and browser or your location from your rental car. You will be operating faster and with less overhead (translation: people) because your systems are connected. You will make smarter decisions because your banking information will finally reconcile with your books--immediately. And in exchange, your bank will know in advance whether you're potentially heading into financial trouble or whether you're a good candidate for additional financing. Oh, and many of these services will probably be selling your data to marketing firms too--but that's a whole other issue.

I once thought that banks would be encouraged to enter into the accounting software business themselves. But, now that a barrier has been broken and it's been realized that data can be shared easily in the cloud I'm now convinced that most financial institutions will focus on what they do best, and leave the accounting software providers to do what they do best. And all of that will enable you and I to do what we do best. Faster and more productively.