Treasury Innovations in Payments


“Digital currency is going to fundamentally affect treasury and your banks,” says Jon Matonis, founding board director of the Bitcoin Foundation. “It’s a matter of when. It has already started to develop.” Although people have grown up with the idea that we need a central monetary authority to issue our money, Matonis insists that “we can have alternatives.”

Explaining the technical infrastructure behind Bitcoin, Matonis says it is the largest distributed computing project in the world. The public ledger is a blockchain, a history of all the previous transactions, and the new blocks secure the transaction. “The Bitcoin network can potentially replace the Visa network or SWIFT,” Matonis believes. Decentralization is important, too, because it eliminates the single point of failure.

For financial services, Matonis says, Bitcoin can replace the intermediary to clear, authorize and settle transactions. “The breakthrough was preventing double spending in a decentralized way,” with the distributed blockchain.

The benefits to consumers include control over their assets, being able to make a backup, bypassing certain payment blockades and no inflation.    

For merchants, Bitcoin enables them to extend their customer base to 60 countries that are blocked by Visa and MasterCard, does not have any disallowed merchant category codes, eliminates chargebacks and fraud, has near immediacy of settlement, and has processing fees approaching zero – for a US$82m transaction, for example, the fee was 4 cents.


Banks have an opportunity to be a Bitcoin exchange. SWIFT has also become involved, Matonis said, with a team doing cryptocurrency research and with assisting Bitcoin in submitting XBT as a proposed ISO 4217 Currency Code.  


However, contrary to what Matonis expects, only 8% of treasury professionals polled at EuroFinance said clients had asked to pay or to be paid using cryptocurrencies.

All Payment Paths Lead to the Center

Neil Morrice, global director, shared services at WorleyParsons, looked at how his company set up its SSC in Malaysia.

Prior to 2012, he says, the company was decentralized and each of its 157 offices operated independently. His team started with procure-to-pay in Malaysia, then added in more functions. Now, expense payments and cash receiving have been moved into shared services.  

One major challenge, Morrice said, was that the company operated in a multitude of legal entities, currencies and processes, so it had to work out how to extract data on cash and manage the FX position. “We were moving those processes into shared services,” he says.

Following a request for proposal (RFP) in 2011, WorleyParsons selected one global bank as its transaction bank and gradually moved all of its process into its SSC. “With our current banking platform, we deal with everyone,” he says.  

A key first step was the process. The team spent a lot of time up front defining the payment templates, how to enforce them, and how to integrate them. They set up better behaviors, forced offices to eliminate checks, introduced payment schedules and picked a global corporate card for lower-end payments. Now, within shared services, the team can do payments across the globe.

Another important piece was banking system integration. The team spent time getting profiles centralized and the staff now has one profile that covers Asia, China and the Middle East. “It created greater visibility, and it made it a lot simpler,” Morrice says. “We standardized the payment format, so we could feed the data through, and we got the connectivity working with the bank, so the payment cycle is cleaner.” WorleyParsons also introduced an interest enhancement facility that enables the company to maximize the interest it earns from the bank.


The key focus, Morrice says, was to simplify the process. “This was successful because it was treasury and shared services working together.”


The Message is Mobile

Mobile offers a multitude of opportunities for treasury, and Bussan Auto Finance India CFO Baljeet Kaur described how her company has leveraged mobile to achieve its goals of reducing working capital and growing the business.

Mobile is especially effective for payment authorization and access to reports. Staff can access statements, view dashboards and authorize transactions securely.


Mobile phones can also be used for collections. Bussan has improved collections tremendously by sending real-time information to collectors, watching real-time how much the collector has collected, and getting funds sent in faster. To support collectors, the company uses a unified payment interface to facilitate online payments. Bussan also leverages mobile for risk analytics information for more effective focus on collections, which it can use to obtain early alerts on credit risks in specific regions.


“This is a classic example of what a treasurer would look at,” Kaur says, “with both the transactional and the decision-making process, and the information process that facilitates it.”


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