Sunsetting your legacy bank: A step-by-step plan for migrating to modern spend management

Founders rarely choose their first banking setup intentionally. They typically go with whatever seems easiest while forming their business: The bank they already use personally, something their accountant suggests, or whatever is closest to the office. That works at the beginning, when spend is simple, headcount is small, and finance can be tracked informally.

But, at some point, the way you manage spend starts to matter. You hire a few people. You take on vendors. You start paying contractors in different places. You try to review budgets or match transactions to receipts and realize your tools aren’t talking to each other. The monthly close slows down. Visibility gets murky. You’re juggling decisions without a clear view of cash.

If that sounds familiar, you’re not alone. And it’s usually a sign that you’ve outgrown the legacy banking setup you started with. The good news: Switching to a modern spend-management stack is easier than most founders expect. This guide walks through the signs that it’s time to migrate, what the modern banking standard looks like, and a step-by-step plan to make the transition smooth.

Most founders don’t switch providers because of a single major failure. It’s usually the result of friction that builds over time. If you’re experiencing any of the following scenarios, it might be time to make the switch.

You’re stitching together too many tools

If you need multiple dashboards just to understand how money is flowing in and out of the business, you’re working harder than you need to. Legacy banks weren’t typically built with integrated spend management in mind. So founders end up using separate tools for approvals, cards, bill pay, and accounting — and then spend hours trying to reconcile the results.

You wait days for your real cash position

When transactions take hours or days to show up, financial decisions can get delayed or made without adequate information. Delayed visibility forces founders into a reactive mode, especially during tight cash cycles or growth periods where real-time clarity is essential.

Your finance work requires too much manual entry

If your team is exporting CSVs, manually categorizing transactions, or keying data into multiple systems, the workload grows with every new vendor or payment method. This leads to errors, longer closes, and unnecessary spreadsheet maintenance.

Your bank can’t support multi-entity or growing teams

Founders often hit a wall when they need:

• Sub-accounts for new entities
• User permissions tailored to roles
• Controlled approval workflows
• Flexible visibility for department leads

Many legacy banks simply aren’t built for this level of sophistication.

Your systems feel fragmented

Tool sprawl, inconsistent reporting, and mismatched transaction details are all signs you’re working around your banking provider instead of working with it. If your systems are pulling your financial data apart instead of bringing it together, it’s time to reevaluate.

For a deeper look at differences between modern financial infrastructure and legacy options, read How safe are fintechs vs traditional banks? on the Mercury blog.

Switching providers is easier when you understand what you're switching to. Modern financial stacks aren’t simply digital versions of legacy systems. They’re built to give founders clarity, control, and automation from day one.

Integrated banking and spend management

In a modern setup, your banking services (like those provided through Mercury’s partner banks) connect seamlessly with spend tools, like cards, bill pay, and accounting integrations. This eliminates the need to shuffle between separate applications to reconcile spend.

Real-time visibility into cash flow

With a modern financial stack, transactions post quickly. Approvals are visible instantly. You can see who spent what, when, and why, without waiting for batch updates.

Multi-user permissions that match your org

A modern stack lets you:

• Assign spend limits
• Give managers budget visibility
• Offer employees controlled access
• Define approval paths that mirror your team

Legacy banking systems rarely offer this level of granularity or customization.

Automation across bill pay, reimbursements, and accounting

Instead of moving information manually, like you might be used to doing with your legacy systems, a modern stack should sync directly with QuickBooks, Xero, or your accounting platform. That way, bills get scanned and coded automatically, spend is categorized with fewer corrections, and month-end reconciliation becomes faster and more predictable.

Why older systems fall short

Legacy tools were built as siloed components: one system for banking, one for bill pay, one for cards, one for AP. The burden of stitching them together falls on the founder. And that’s where errors occur and time gets lost.

For more on evaluating providers, explore Best Banks for Business Accounts for Startups and Benefits of a Business Bank Account on the Mercury blog.

A common mistake is assuming your next system needs to match the sophistication of a future, much larger version of your company. That instinct leads founders to design workflows meant for 100-person teams when they currently have 10. This results in unnecessary complexity, slow adoption, overly expensive tools, and approval paths no one uses.

Instead, design for the next six to 12 months. You’ll want a setup that gives you clearer insight today, and scales naturally as the business grows.

For a smooth migration, avoid these common mistakes:

• Don’t set up approval chains with more steps than you have managers.
• Skip the custom roles no one knows how to maintain.
• Opt out of tools that require an operations hire just to manage access.
• Avoid systems that only work once your chart of accounts is “perfect.”

You’ll save time by choosing clear systems with accessible onboarding, not theoretical future needs.

Even small teams benefit from up-front coordination. Planning together can prevent surprises and ensure that the shift feels intentional, rather than abrupt.

Questions to answer with your team include:

• Who needs visibility into budgets or spend?
• Who should have the ability to approve payments?
• Are you aiming for more control, more automation, or both?
• What reporting cadence do you want going forward?
• Do you want approval workflows, spending limits, or both?
• Are you simplifying your system or simply swapping tools?

Clarity here will shape the rest of your migration plan.

Your migration plan is the heart of the process. A clean migration doesn’t require a finance team, just some thought and a short period of parallel operation.

Step 1: Audit your current setup

To audit your systems, start by mapping the tools and workflows you currently use for:

• Banking
• Cards
• Bill pay
• Payroll
• Accounting
• Reimbursements

Note which parts of your processes require manual work or duplicate effort. Capture any recurring frustrations, like delayed settlements, missing transaction details, or approvals that happen in Slack instead of a system. Use this system audit as your blueprint for designing something better.

Step 2: Define your goals

Different teams switch providers for different reasons. Clarify what your team hopes to improve. Examples include:

• Faster month-end closes
• Less manual entry
• Real-time budget visibility for department leads
• A cleaner approval flow
• Better syncing across your accounting systems
• The ability to manage spend across multiple entities

Naming these intended outcomes will help your team evaluate tools clearly.

Step 3: Choose your new financial stack

Determine with tools and software your business needs to run efficiently. A modern configuration might look like:

• Mercury for banking services through partner banks
• Mercury IO for bill pay and AP workflows
• Mercury Cards or Ramp for spend management
• QuickBooks Online or Xero for accounting

This combination keeps spend, approvals, payments, and reconciliation connected. It also simplifies onboarding for new hires because everything exists in one ecosystem.

Step 4: Plan your transition

Choose whether to migrate function-by-function or entity-by-entity. Most teams use the functional approach because it allows for structured testing.

A typical sequence looks like this:

1. Set up your new account and cards.
2. Move bill pay.
3. Shift payroll or contractor payments.
4. Update accounting integrations.
5. Transition vendor auto-debits.
6. Update revenue or payout accounts, if needed.

A pilot group — such as one department or a small number of card users — can help validate that everything works before the full cutover.

Step 5: Communicate and train

Even small teams need a moment to adjust. To get every onboard, share:

• The new place to request spend
• How approvals will be handled
• How to submit receipts, if applicable
• Who to ask for help during the transition

Clear communication reduces friction and accelerates adoption.

Step 6: Cut over and monitor closely

After you make the switch, run both systems in parallel for a short period. During this overlap period, you need to:

• Confirm recurring payments are routed correctly.
• Verify accounting syncs cleanly.
• Monitor approval flows in real time.
• Catch any missing vendors or subscriptions.

Set success metrics based on your goals, such as: 

• Hours saved at month-end
• Minutes saved from reduced manual entry
• Speed of approval time
• Forecasting accuracy rates

To track each step of your migration, download our migration checklist.

Switching financial systems is ultimately about creating a foundation that makes decision-making clearer and faster. But, like any operational change, it comes with benefits and risks you’ll need to consider.

Benefits

The advantages of migrating to a modern spend management system include: 

• Real-time visibility
• Faster reconciliation
• Fewer errors from manual data entry
• More control over spend
• Clearer workflows for approvals and budgets
• A financial stack that scales naturally

Risks

Migrating to a new system can come with some stumbling blocks, too, such as:

• Temporary confusion during the cutover
• Vendor payments routed to the wrong place, if not updated
• Gaps in accounting sync
• Team uncertainty around new approval processes

Mitigation strategies

To help your migration go as smoothly as possible, be sure to:

• Use a pilot group to test workflows.
• Train teams clearly and early.
• Keep both systems active briefly.
• Validate all recurring payments.
• Track wins — such as time saved, errors reduced, and fewer delays — to reinforce adoption.

Sunsetting your legacy banking setup isn’t about chasing shiny tools. It’s about building a financial foundation that supports how your business actually operates. Modern spend management gives founders faster insight, cleaner workflows, and more control. And, when there are fewer opportunities for errors, accuracy improves

The switch doesn’t have to be complicated. With a clear plan, a short overlap period, and alignment across your team, you can move to a modern financial stack that saves time and improves decision-making.