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Treasury’s technology wish list

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by Mark Parsley

Published: April 27th 2017

New technology promises to transform treasury, but what are the pain points treasurers would like it to solve first? EuroFinance has sampled the views of more than 230 treasurers in a straw poll to find out.

Top of the treasury wish list is help with every aspect of cash forecasting. Treasurers are still struggling with “consolidating actual daily cash positions among hundreds of bank accounts, currencies and dozens of legal entities in many banks” let alone being able to overlay real-time data from ERP systems, bank and other market data sources. They still struggle with modelling different cash scenarios based on multiple collection scenarios and different outlay scenarios. They struggle with short-term forecasting, long-term forecasting, multi-currency forecasting, cash-flow projections, daily cash positions. At the core of these problems, “the complexity, inefficiency and inflexibility of overall treasury infrastructure …. technology should be embedded in treasury processes not just used to solve a particular issue or challenge.”

Next comes help with all things bank related. Satisfying the documentary needs of KYC and AML processes, bank account management and the overall problems caused by having to manage multiple bank relationships globally are a time-consuming, expensive and inefficient burden on treasurers and one they would like to see reduced. Surprisingly, given how long eBam has been in development, “the never-ending requirement to keep signatories to bank accounts up-to-date” is still a major headache for many treasurers. “I dream of a central system receiving information from HR-files which connects with our treasury systems and externally to the banks and uses a secure standard for exchanging this information electronically, defining the specific powers (payment authorization, trading, signing contract etc.). So, a bit more than just eBam.”

Payments – and in particular the problems of low-value-added data entry and manual intervention – remain a headache. The complexity of payment information is a basic issue but more companies seem now to be finding cross-border payments in difficult currencies or regulatory environments a challenge – perhaps as more firms move into new markets. Overall, treasurers look forward to the day when payments are automated and STP, can be made instantly, tracked and recalled if necessary. Good news for SWIFT’s GPII?

Finally, fraud: treasurers are increasingly worried by the ease with which, in a digital world, they can be “robbed”, as one put it. They understand that third-parties, their banks, their suppliers and their customers can all be defrauded via them and, vice versa, that they can be attacked indirectly through those channels. There of course technology is the enabler. The question is, can it also be the saviour?

In other words, treasurers today need help with the things they have always struggled with, only more so as they globalise and digitalise. But all of these problems come down to one overarching problem: data. Treasuries do not have easy access to the data they need when they need it. They can’t pull financial or operating or banking information together into a consistent, up-to-date database from which they would then be able to derive the models, scenarios, forecasts and cash positions they need.

And this was reflected in the poll: the overall message is a plea for help with integration in a treasury and wider financial environment of incompatible technologies and datasets, fragmented protocols and regulations, and, in general, an IT infrastructure that is not up to the tasks demanded of it.

This big picture problem means that the things treasurers left out is as interesting as those they mentioned: supply chain finance (where FinTechs have genuinely useful solutions), risk management, whether cyber, FX, interest rate or commodity and funding. The need for basic integration overrides these functions, all of which are perhaps easier to operate as quasi-standalone activities.