Convergence and Convenience in Treasury Technology

Whereas treasury systems simply used to be a necessity in the back office, they have turned into a competitive differentiator for banks and corporates alike. Treasurers need technology that can automate and standardise, processes as well as provide a complete view of cash flows and risk exposure across the region or around the globe.

Even though leading-edge systems may seem almost mundane for some multinationals, smaller firms and even many large companies in Asia still have gaps in their treasury system capabilities. As they look to manage treasury technology better, two key trends in treasury technology stand out – convergence and convenience.

Convergence refers to combining varied software and processes into an integrated system that provides the data, transparency, information and flexibility treasurers need to manage their business better. As software vendor Calypso says, treasurers need software that will enable them to “improve cash visibility across the enterprise, optimise their financial hedging and intercompany funding activities, and analyse overall financial risks encountered by the corporation for strategic decision making.”

Whereas a legacy treasury system, based on multiple software packages for specific functions and manual input into spreadsheets for everything from imported data to foreign exchange (FX) positions, may have worked in the past, software now needs to bring everything under one roof. The convergence into an integrated system means that the confusing state of separate software for separate functions, as well as the manual data entry, could disappear. The system often needs to include centralised transaction execution and cash management, as well as a single database and standard interfaces to other tools. Along with integrating with the enterprise resource planning (ERP) system, the new system often has to integrate with SWIFT easily too. Top international vendors are moving towards a single integrated system that delivers these capabilities and more for the front, middle and back offices.

In addition to a robust and integrated system, constant connectivity and mobility require far more than just a system that treasurers can access on a computer in their office. Treasurers now need the convenience of easily accessing the system anytime and anywhere without extensive training.

One part of convenience is that the system has to be easy-to-learn and easy-to-use. As Frank Dux said about e-banking software this month, for example, it has to be “intuitive and efficient to use in order to outperform the market.” Treasury staff need software that takes just hours or minutes, rather than days, to learn.

The software also has to be available anytime, anywhere. As Neal Livingston of Standard Chartered Bank told gtnews last month, treasurers need “the convenience of authorisation in the hands of the executive on the go” so that “clients get the same functionality and the same user experience whether they’re on the mobile, online or on the host.”

With rapid shifts in FX rates, disruptions to the supply change in Asia and the Middle East and increasing volatility in other areas as well, a robust treasury system has shifted from nice-to-have to more essential than ever. Vendors offer a variety of systems to enable higher levels of corporate performance, and many companies have taken advantage of them. As SunGard has said, centralising treasury onto a single platform enables corporations to “achieve better connectivity to banks and other trading partners, establish consistent controls and audit capabilities and obtain a global view of information.” For any firm hasn’t done that already, it’s time to leverage convergence and convenience to drive the company forward.

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