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Software & Systems

Digital Innovation Needs Collaboration

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November 04, 2016

AFP panel: rapid pace of digital advancements means corporates, banks and technology providers must work together.

Distributed ledgerExciting new innovations offer promising improvements to many aspects of treasury, including working capital management, payment processing and cash forecasting, to name a few. And the rapid pace of digital transformation will require corporates, banks and technology providers to work together to ensure these new innovations are successfully implemented. Timed properly it will allow for the highest level of processing efficiency.

This was the upshot of a panel discussion on current and emerging technology strategies for transforming treasury at the recent 2016 AFP Conference in Orlando, FL. Geri Westphal, Senior Director at the NeuGroup, participated in the panel discussion, hosted by Citi for their clients, along with Ron Chakravarti, Managing Director from Citi, Jordan Novak, Managing Director from C2FO and Kevin Daniels, Chief Product Officer from C2FO.

Based on survey data collected by the NeuGroup, many treasury organizations have made updating their systems (including TMS and other third-party add-ons) a top priority in recent years. And along with process improvements that include enhanced in-house bank structures, pay-on-behalf-of, virtual account structures and robust supply chain finance programs, they stand ready for the next wave of technology that is likely to include new forms of digital payments, mobile payments, and blockchain.

Although not everyone wants to be on the leading edge of technology, it will be important for corporate treasury departments to stay ahead of what is happening in the world of digital transformation so they are not caught behind the curve when emerging innovations become mainstream (i.e. working capital management, mobile payments, big data, blockchain, etc.).

As part of the panel discussion, both Citi and C2FO debunked the notion of “fintech disruption” and embraced a more collaborative partnership where banks and fintech work jointly to identify and solve today’s challenges. Many of the new technology trends will have an impact on treasury; it’s not a matter of if, it’s a matter of when.

The group discussed the fundamental changes in the overall business environment, including the customers’ demand for faster, more convenient order and payment options, the increase in e-commerce and the “millennial” effect on traditional business models. Although many of the most recent technologies impact the B2C space, it is expected that these innovations will move quickly from B2C to B2B, further strengthening the notion that treasury leaders need to stay ahead of what’s happening in the markets.

Treasury departments have worked very hard to obtain world-class status and have achieved a high level of success over the past several years. However, it’s not a one-and-done project; once world-class status is achieved there is continued work needed to maintain the highest level of efficiency and innovation. World-class is a journey and not a destination. Fintech innovation promises more change and today’s treasurers would be wise to keep their eye on the ball to stay on par with new offerings.

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