As businesses grow and operate across multiple markets, they require real-time visibility, greater control, and optimized liquidity management. Financial institutions (FIs) have an opportunity to enhance their treasury offerings; i.e. treasury management systems to meet these evolving needs.
Single-account treasury Management (SATM) is more than just a product—it’s a strategic enabler that helps banks strengthen client relationships, improve operational efficiency, and stay competitive in an evolving financial landscape. With the increasing demand for sophisticated treasury solutions, banks that innovate in this space can position themselves as key partners in their clients’ financial success.
Need for Single Account Treasury Management
Conglomerates seek SATM to reduce complex workflows, consolidate accounts, and better understand their liquidity position. Businesses demand treasury management systems to improve cash flow visibility and centralize liquidity across subsidiaries.
Banks, however, cannot help conglomerates centralize all cash and financial transactions. This is where Finstream comes into play. As a treasury management system, it helps bank customers with automated reconciliation and robust reporting capabilities, understand their financial position comprehensively and make data-driven decisions.
Banks offer single-account treasury management for:
- Evolving Client Demands: Modern businesses and huge corporations require better liquidity management. Traditional banking methods often fail to meet these complex needs.
- Globalized Operations: Multinational companies operate across multiple jurisdictions, facing challenges in managing diverse banking relationships, currencies, and regulatory requirements.
- Increased Regulatory Scrutiny: Growing compliance requirements necessitate robust and transparent treasury management systems.
- Operational Inefficiencies: Fragmented cash management leads to increased administrative overhead, errors, and delays, impacting overall financial performance.
Cutting Edge Solutions
While technology has evolved rapidly, banks and financial institutions still face challenges in developing certain technological capabilities internally. To bridge this gap, they are increasingly forming strategic partnerships with fintech firms to provide state-of-the-art solutions to their corporate clientele.
Single Account Treasury Management is one such solution that enables Finance Directors and treasury teams to track all cash positions in real time across multiple accounts, banks, and currencies. It is a replacement of multiple disconnected systems, enabling businesses to move money efficiently and stay ahead of financial risks.
Treasury management software provides integrated tools to optimize working capital, manage cash pools, and prevent cash shortages. FinStream, as a platform, centralizes and automates payments to suppliers, employees, and partners. It automates regulatory reporting requirements and maintains a full audit trail while ensuring treasury activities align with financial laws and industry best practices.
Challenges of Traditional Banking
CFOs, Finance Directors and Treasury teams find it difficult to gain control over the working capital, consolidate cash inflows and outflows, and carry out manual reconciliation by spending hours. A few traditional banking challenges faced by conglomerates are:
- Scattered Cash: Cash is scattered across multiple banks and entities with no real-time visibility.
- Cash Consolidation: Treasury teams struggle to consolidate cash inflows and outflows from multiple business units.
- Manual Workload: Spending hours on manual reconciling of transactions and compliance tasks is cumbersome.
- Multiple Currency Risk: Currency fluctuations cause unpredictable financial losses.
- Fraud & Suspicious Transactions: Payments processed through multiple systems and banks increase the chances of fraud/ risk.
- Efficient Investments: Idle cash is not invested efficiently.
Technology helping Banks meet Treasury Needs
Banks partner with fintech companies like Teknospire to help them meet treasury needs. FinStream is a perfect fit to support banks in meeting their customers’ demands, and offer bank treasury services.
As a treasury management system, FinStream has a quick implementation and comes with:
- Automated cash pooling
- Multi-bank connectivity for global cash visibility
- Liquidity and working capital management
- Centralized payment processing with regulatory compliance
- ERP and financial system integration
Benefits of Single Account Treasury Management
The following benefits enable treasury teams to operate more efficiently, make better-informed decisions, and contribute more strategically to their organization’s financial success.
Here are the advantages of our treasury management system, FinStream:
- Improved Operational Efficiency: FinStream streamlines workflows for cash management and reporting and reduces operational costs.
- Enhanced Risk Management: It provides real-time visibility and control, mitigating fraud and operational risks.
- Accurate Cash Positioning: FinStream supports better cash positioning and accurate prediction of future cash flows and liquidity needs.
- Better Accuracy & Treasury Data Control: Businesses will no longer suffer from manual data entry errors. The solution enables automated data validation and error-checking processes for all conglomerates.
- Strategic Decision Making: The platform enables a data-driven approach to treasury management and financial planning.
The Future of Banking and Treasury Management
The evolution of banking and treasury management is inextricably linked to technological advancement and the ever-increasing demands of sophisticated corporate clients. Treasury Management Systems are a fundamental shift towards more integrated, efficient, and data-driven financial operations.
The future will be characterized by even greater collaboration between banks and fintech innovators. Platforms like FinStream are paving the way for seamless, real-time treasury management, enabling conglomerates to transcend the limitations of traditional banking systems.
In a nutshell, businesses will experience enhanced liquidity risk management and better cash flow visibility with more advancement in technology and expertise.