Model Context Protocol(MCP)

Model Context Protocol (MCP) is an open standard, originally proposed by Anthropic in late 2024 and broadly adopted across the AI tooling industry by 2026. It defines how AI assistants connect to external tools, services and data sources.

Practically: MCP is how Claude Code talks to Xero, Shopify, your inbox, your Notion workspace, your database. Each external service is wrapped in an “MCP server”, a small program that exposes a typed set of tools the AI can call.

Why it matters

Before MCP, every AI tool integration was bespoke. Connecting Claude to Xero meant building a custom OpenAPI wrapper for that specific use case. Connecting Claude to Shopify meant building another. Multiply across 30+ services and the work becomes the bottleneck.

MCP standardises the wire format. Once a service has an MCP server (and many do, including Xero, Shopify, Slack, GitHub, Postgres, Gmail, Notion, Linear and dozens more as of 2026), any MCP-aware AI client can use it: Claude Code, Claude Desktop, Cursor, Continue, Windsurf, etc.

For Australian small business, this means setting up Claude Code with your existing stack is now a config-file task rather than a build project.

What an MCP server is

A program that runs on your machine (or as a hosted service) and:

1. Connects to the underlying service (Xero, Shopify, etc) using its API
2. Exposes a structured list of tools the AI can call (“list_invoices”, “get_inventory_levels”)
3. Returns typed results when the AI calls those tools

You install an MCP server, configure it in your AI client (.mcp.json for Claude Code), and the AI can now use the service.

Australian-relevant MCP servers worth knowing

• Xero, official, AU-supported
• Shopify, official
• Slack, official
• Gmail / Google Workspace, community + official
• GitHub, official
• Notion, official
• Postgres / MySQL, community
• Filesystem, built into Claude Code

More are added monthly via the official catalogue.

Related terms

• Tool use
• Agent
• Agentic loop