Live Bank Feeds with Plaid: How Automatic Transaction Import Works

If your accounting workflow still involves downloading a CSV from your bank, reformatting it, and uploading it into your accounting software — you're spending hours every month on work that can be fully automated. Plaid-powered bank feeds eliminate this entirely: your bank transactions flow into TallyArc automatically, continuously, and without any manual intervention.

This guide explains how Plaid bank connectivity works, what it means for your day-to-day bookkeeping, and how to set it up in under a minute.

What is Plaid?

Plaid is the leading financial data connectivity platform — the infrastructure layer that connects user bank accounts to third-party financial applications. It's the same technology powering the bank connection features in leading fintech apps. Over 11,000 financial institutions across the US and Canada are supported, including every major bank, regional bank, and credit union.

When you connect your bank account through Plaid, your credentials never touch TallyArc's servers. You authenticate directly with Plaid's encrypted widget, and Plaid issues TallyArc a secure access token — which grants read-only access to your transaction data. Your banking password is never stored anywhere in TallyArc.

How the sync works: cursor-based incremental import

TallyArc uses Plaid's Transactions Sync API — a cursor-based incremental sync system. Here's what that means in practice:

1. On first connection, TallyArc fetches your recent transaction history (typically 90 days)
2. Each transaction is stored with a unique Plaid transaction ID to prevent duplicates
3. On every subsequent sync, TallyArc requests only new and modified transactions since the last cursor position — not the full history
4. Plaid also sends removed transaction signals — useful when pending transactions settle or are voided
5. The cursor advances after each successful sync, so the next sync is always efficient regardless of how long since the last one

The practical result: your bank account balance in TallyArc is always accurate, and you're not paying in API calls to re-fetch data you already have.

What happens with each imported transaction

Every transaction Plaid delivers is stored as a Bank Transaction record in TallyArc. Plaid returns:

• Merchant name — the cleaned, standardised name (e.g. "Amazon Web Services" not "AMZN*MKTP US")
• Transaction date — the settled date, not the pending date
• Amount — Plaid uses the convention that positive = money out of your account; TallyArc reverses this so positive = money in (matching standard accounting)
• Transaction ID — used as the reference to prevent duplicate imports if you sync multiple times

Once in TallyArc, transactions appear in your bank feed and can be matched against open invoices (for inflows) or vendor bills (for outflows) during bank reconciliation.

Bank reconciliation with a live difference calculator

With a live bank feed connected, month-end reconciliation becomes a simple check-box exercise rather than a multi-hour data matching effort:

1. Navigate to Accounting → Bank and open your connected account
2. Click Reconcile and enter your statement ending balance
3. Check off each transaction that appears on your statement — TallyArc calculates the running difference in real time
4. When the difference hits zero, your books are balanced — click Finish to close the reconciliation period

Because transactions are already imported via Plaid, you're not copying numbers — you're simply confirming that everything that should have cleared, did clear.

Connecting your bank account in TallyArc

The setup takes less than a minute:

1. Go to Accounting → Bank
2. Click ⚡ Connect Bank
3. Search for your bank in the Plaid widget and authenticate with your online banking credentials
4. Select which account to link (checking, savings, etc.)
5. Transactions import immediately — you can sync again at any time with the ↻ Sync button

You can connect multiple bank accounts — one Plaid connection per account. All connected accounts appear on the Bank Accounts overview page with their current balance and last sync time.

What Plaid does not do

Plaid provides read-only access to your transaction data. It cannot initiate payments or transfers on your behalf. It does not have access to your full account number — only the last four digits are returned for display purposes. Plaid is SOC 2 certified and compliant with financial privacy regulations.

TallyArc stores the Plaid access token (not your banking password) and uses it exclusively to fetch transaction data. You can revoke access at any time by disconnecting the bank account from the TallyArc bank accounts page.