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Neil Gray

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Neil Gray - SWIFT

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Payments strategies 2015-2020-2030

Payments systems visions, strategies, trends, pilots, forecasting, and planning for the short-, medium-, and far-term.

Revolution meets Evolution

23 February 2015  |  2463 views  |  1

It seems that more and more today, in the world of financial services technology, revolution is very much disrupting the path of evolution that we have tended to follow.

Financial institutions and indeed the providers of technology on which the industry runs, continue to be under pressure to get it right and deliver technology solutions that meet the demands of Corporates. 

On the one hand we have some extremely clever people and technologies in the financial services sector.  There are some very innovative point solutions.  Only 5 years ago we would not have thought of conducting our personal banking activities via “apps” on our mobile phones.  In fact, did we even know what an “app” was back then? We are all using “the Cloud” in some shape or form, and as if by magic we can do some very clever things anytime, anywhere.  Yet despite this quantum leap in development and delivery of technology solutions, we still at the Corporate treasurer level, keep coming back to that old nugget of having to get the integration piece right so we can meet the demands of our organisations, faster and cheaper.  It’s a tough nut to crack!  Well it must be, we’ve been at it for decades!

Corporates will tell you that for them, business growth and success depends upon their ability to meet ever changing customer demands, keep ahead of the competition and deliver a first class customer experience.  Understanding their financial situation, make informed and timely decisions is nothing new although the lifecycle of products and services is now much shorter.  CEO’s and their management teams must have accurate financial data “on demand” in order that they can make effective decisions more quickly. 

At a recent event where banks, corporates, technologists and service providers met, there was a stark reminder that the pain-points Corporates experience today haven’t really changed in a technology market awash with very clever, sophisticated technology.

The series of key pain-points reeled off by Justin Callaghan, Executive Director, FTI Treasury, seemed to be sadly all too familiar to those Corporate treasury people in the room.  No matter the size of the business, the issues seem to be the same:

  1. How much cash do we hold?
  2. Where is the cash and is it at risk?
  3. Why can’t we readily access available cash?
  4. What’s the status of our multi-currency notional pool?
  5. How much cash will I have tomorrow?
  6. Access to systems - why so many logins and why can’t I get payments authorised in a timely fashion?
  7. How can I gain better control of my financial systems?

How is it that our Corporate treasurers are still grappling with the lack of reliable and accurate data for decision making and cash forecasting when it seems there is a plethora of technology solutions out there!

It seems, it’s integration creating the challenge.

Let’s not underestimate the challenges when data and processes are buried in old systems, deep inside an organisation which are further compounded when the organisation is a global and diverse business.

Whilst there is no magic solution that will solve all of these problems, there are some interesting and financially viable options on the market today.  Depending upon the size of the organisation, the extent of the challenges and what the business drivers are for change, a number of vendors are offering point solutions that take some of the “must have” elements of treasury as well as AP/AR and creating a “Lite” solution to help with payment approvals workflow and cash management.  These solutions deliver timely data to assist with as good as real-time awareness of current financial positions and help decision making to be faster and therefore more effective.  Much like your online banking app!

Faster, cheaper, easier – we all strive for improvements to our financial transaction processing activities – it seems that if a “Lite” option will suffice, and for small to medium sized Corporates, this would have seem to have appeal.

I am keeping a close eye on the market players and see some very interesting developments.  I look forward to digging deeper and uncovering more of these gems which I am happy to share with my industry colleagues. 

 

TagsPaymentsTransaction banking

Comments: (1)

Prasenjit Das
Prasenjit Das - NIIT Technologies Limited - Noida , India | 23 February, 2015, 15:50

Yes as of now many banks have the challenge where information is in silos .The good thing is that there are many standard applications with standard login which can be implemented in a single location to provide customers with a global view by supporting treasury management, including payables, receivables, liquidity management, cash flow forecasting, financial supply chain management, wire, ACH and electronic invoice presentment/payment. As regards banks have to comply to BCBS 239 whereby they have to provision for such data.Besides they have to comply to the needs of LCR for Basel III.

 

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