What is Account Aggregation?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 04 January 2019
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    Conjecture Corporation
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Part of maintaining any type of financial records requires organization. Whether handling the income and expenditures for a household budget or the operating budget of a major corporation, it is important to have all the information in one central repository. That is the essence of account aggregation. In effect all Accounts Payable and all Accounts Receivable information is kept in one simple set of accounting books, either hard copy or electronic versions. Account aggregation is all about consolidating bills, so there is the chance to see a true picture of the current amount of indebtedness. There are several advantages to this approach.

First, consolidation of all outstanding debt into one source of information, such as a database, makes it possible to develop a workable plan for managing the debt. This cannot be accomplished effectively without taking into consideration all outstanding obligations. As an example, a household attempting to juggle multiple credit card balances, a mortgage, and a car loan will benefit greatly by having a solid budget in place each month. Using account aggregation to identify each budgeted item and the amount of the household income that is to go for each item will go a long way toward preventing any unpleasant surprises at the end of the month.


Second, account aggregation helps make it easier to spot recurring debts that are near completion. This knowledge makes it easier to plan on where to redirect those funds once a debt has been retired. For instance, the household budget shows two of the five credit cards currently in the budget are now under $300.00 US Dollars (USD) each. Realizing that it will be possible to revise a couple of other variable items and allow one of those cards to be paid off quickly will result in being able to pay off the second card in short order. Identifying debts with the lowest balances and paying extra until the debt is eliminated is one of the simplest ways to get out of debt. Account aggregation can provide a clear road map on how to employ this process.

Last, an account aggregation makes it possible to measure progress in retiring debt by identifying ways to effect debt consolidation. For example, consolidating credit cards and their balances onto a credit card account with lower interest is a great way to save money and also show paid off items on your credit report. Consolidating debt in this manner also means less line items to keep track of each billing period. Account aggregation makes it much easier to spot opportunities of this sort, since the data is all in one place, making it easy to compare the status of various accounts.

There is not really a down side to account aggregation. As a means of maintaining a realistic picture of financial status, as well as providing data to allow for the reduction of debt, the simple process of account aggregation is something that just about anyone can benefit from and accomplish with ease.



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