The basic steps to add a bank account
To add a bank account in Xero, go to Settings in the left menu, then select Bank accounts. Click the blue Add account button. You will see two paths: connect a live bank feed (which pulls real transactions automatically) or enter account details manually. Most users choose the live feed because Xero then matches incoming transactions to your invoices and bills without extra work.
If you choose a live feed, Xero will ask you to log in through your bank's website or a third-party connection service like Plaid or Yodlee, depending on which banks Xero supports in your region. You authorize Xero to read your transactions—not to move money or change settings. Once connected, transactions appear in Xero within 24 hours, usually faster.
If you choose manual entry, you type in your account number, sort code (in the UK), routing number (in the US), or equivalent identifier for your country, and Xero stores it. You will then upload bank statements as CSV or OFX files, or enter transactions by hand. This route takes longer but works if your bank does not support live feeds.
Key Takeaways
- Live bank feeds pull your real transactions into Xero automatically and match them to your invoices, saving hours of manual entry each month.
- Xero connects through your bank's login or a third-party service like Plaid; you authorize read-only access, not payment authority.
- Manual entry requires you to upload CSV or OFX files or type transactions yourself, and is slower but works for banks without live feed support.
- Once added, your account appears in the Bank accounts list and you can reconcile it monthly by matching Xero transactions to your bank statement.
Connecting a live bank feed step by step
Click Add account and select Connect to your bank. Xero will show you a list of banks and payment networks it supports in your country. Search for your bank by name. If it appears, click it and you will be taken to your bank's login page (or Plaid's, depending on the setup).
Log in with your online banking credentials. Your bank will ask you to confirm that you want Xero to access your account. This is a read-only permission—Xero cannot move money, change your password, or alter settings. Once you confirm, Xero returns to the setup screen and shows your available accounts (checking, savings, credit card, etc.). Select the account you want to track in Xero and click Connect.
Xero will ask you to name the account (for example, "Business Checking" or "Operating Account") and assign it a currency. It will also ask whether this is a bank account, credit card, or other type, because Xero handles reconciliation differently for each. Once you save, the account appears in your Bank accounts list and transactions begin flowing in within a few hours.
Setting up manual bank account entry
If your bank does not appear in Xero's list, or if you prefer not to connect live, click Add account and select Enter account details. You will fill in your account name, account number, and routing or sort code. The exact fields depend on your country and account type.
After saving, Xero will not pull transactions automatically. Instead, you upload bank statements as files. Go to your bank's website, download your statement as a CSV or OFX file (most banks offer both formats), and return to Xero. In the account details, look for an Upload statement or Import button. Select your file and Xero will read the transactions and add them to the account.
Alternatively, you can enter transactions manually by clicking New transaction within the account and typing in the date, amount, payee, and description. This method is slow for high-volume accounts but works if you only have a few transactions per month or if your bank does not export statements in a readable format.
What happens after you add an account
Once your account is live in Xero, transactions appear in the Bank transactions section under Business. If you connected a live feed, new transactions show up automatically. If you uploaded a statement or entered transactions manually, they appear only after you complete that step.
Xero uses machine learning to match incoming transactions to your invoices and bills. For example, if a customer pays an invoice for $500, Xero will recognize the matching $500 deposit and suggest that you mark the invoice as paid. You review the match and click Confirm to accept it, or Reject if it is wrong. This matching saves time during reconciliation.
At the end of each month, you reconcile the account by comparing Xero's balance to your bank statement balance. Open the account, click Reconcile, and Xero will show you which transactions have cleared and which are still pending. You mark cleared transactions as reconciled, and Xero flags any discrepancies so you can investigate.
Troubleshooting connection problems
If your bank does not appear in Xero's list, it may not support live feeds in your region yet. Check Xero's support page for your country to see which banks are supported. If your bank is listed but the connection fails, try logging out of your bank's website first, then attempt the connection again. Sometimes an active session interferes with the authorization process.
If you see an error message like "Invalid credentials" or "Connection timeout," wait a few minutes and try again. Bank connection services sometimes experience brief outages. If the problem persists, contact your bank to confirm that your online banking is active and that you have not recently changed your password.
If transactions are not appearing after 24 hours, check that the account is still connected. Some banks require you to re-authorize Xero periodically (usually once a year). Go to Settings > Bank accounts, find the account, and look for a Re-authorize or Reconnect button. Click it and log in again through your bank.
Switching between live feeds and manual entry
You can change how Xero receives transactions from an account, but the process requires care. If you are currently using a live feed and want to switch to manual entry, go to the account settings and click Disconnect. Xero will stop pulling new transactions. You can then upload statements or enter transactions manually going forward.
If you are using manual entry and want to switch to a live feed, click Connect to bank in the account settings. Log in through your bank and authorize Xero again. Xero will begin pulling transactions from the date of reconnection forward. It will not re-import old transactions you entered manually, so your historical data remains as you entered it.
Switching methods does not delete existing transactions or reconciliation history. All past transactions stay in Xero and remain linked to invoices and bills. Only new transactions going forward will come from the new source.
Frequently Asked Questions
Can I add multiple bank accounts to one Xero organization?
Yes. Click Add account as many times as you need. Each account appears separately in your Bank accounts list and has its own transaction feed and reconciliation. This is useful if you have a business checking account, a savings account, and a credit card all in Xero.
Does Xero charge a fee to connect my bank?
Xero does not charge a separate fee for bank connections. The cost is included in your Xero subscription. Your bank may charge you for online banking access, but that is separate from Xero.
Is it safe to give Xero my bank login?
Yes. Xero uses bank-level encryption and does not store your password. When you log in through your bank's website or Plaid, you are giving Xero read-only permission to see transactions, not permission to move money or change settings. Your bank controls what Xero can see.
What if my bank account is in a different currency?
When you add the account, Xero asks you to select a currency. If your account is in euros but your main business currency is dollars, Xero will convert transactions at the exchange rate on the transaction date. You can see both the original currency and the converted amount in your reports.
Can I delete a bank account from Xero?
Yes, but only if it has a zero balance and no unreconciled transactions. Go to the account settings and click Delete. If the account has a balance or pending transactions, reconcile or clear them first. Deleting an account does not affect your bank; it only removes it from Xero.