Banks and corporates could reap huge benefits from real-time liquidity management functionality, but industry-wide collaboration is crucial to make it a reality, according to a new Deutsche Bank white paper.
The paper argues that a standardised real-time treasury framework would enable banks to provide a range of value-added services, including real-time currency conversion and hedging, instant cash concentration solutions, intraday cash pooling and optimised short-term investments.
The call comes as there is global momentum for real-time payments and APIs, prompting a knock-on effect for liquidity.
To reap the benefits of real-time liquidity, banks will need to transform their clearing and settlement architecture, help corporates develop their own real-time-ready systems, and collaborate with TMS and ERP vendors to ensure complete end-to-end efficiency of operational processes.
Vanessa Manning, head, liquidity and investment solutions, GTB, Deutsche Bank, says: "The first step to achieving real-time liquidity capabilities will be industry-wide conversation, be it through forums, advocacy or continued dialogue with regulatory bodies.
"Only then will the industry be able to collectively define the standards and best practices that will shape the next generation of liquidity and collateral management."
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