The Way in Which Banks and Fintechs Are Approaching Treasury Needs
The corporate treasury landscape is transforming as banks and fintechs collaborate to meet the dynamic needs of modern businesses, as outlined in FinTech Magazine. This partnership is enabling treasury departments to become more strategic, streamlining operations, and improving financial decision-making.
Historically, corporate treasurers were tasked with managing cash and ensuring liquidity. Today, their role has expanded significantly, encompassing business planning, risk management, and strategic advisory functions for CFOs and the C-suite.
Victoria Blake, Chief Product Officer at GTreasury, encapsulates this evolution: «Treasury is the unsung hero responsible for making sure the business has enough money—cash—to run the business operations as needed and required. It’s very responsive to the agile and changing strategies of the business.»
To address these expanded responsibilities, banks are reimagining treasury services, integrating advanced tools like treasury management systems, cash forecasting, and other finance solutions. These innovations align banks closer to the decision-making core of their corporate clients.
Craig Jeffery, Managing Partner at Strategic Treasurer, emphasizes the importance of partnerships between banks and fintechs: «Cooperation and collaboration are not merely an option; they are the way forward. Some banks are innovating directly, but there are far more start-ups and fintechs coming up with new solutions that need to be integrated.»
Fintech collaborations are providing banks with access to agile technologies, while fintechs benefit from banks’ established client bases and regulatory expertise. Blake highlights how fintech has disrupted traditional treasury operations: «Fintechs have disrupted treasury operations through tooling—putting in the technology has allowed greater efficiency and greater accuracy. It’s also allowed a move towards standardised best practices.»
Despite the benefits, hurdles remain. Budget constraints often limit corporate treasurers’ access to new technologies, as many share resources with other departments. Integration with legacy systems is another critical challenge, requiring seamless connectivity to unlock the full potential of modern solutions.
Looking ahead, innovations like AI, predictive analytics, and blockchain are poised to further transform treasury operations. For CFOs and finance directors, staying informed and fostering partnerships with banks and fintech providers will be essential.
Blake underscores the strategic value of these innovations: «This technology gives you the freedom to think about what I am really trying to do. It’s about empowering these folks. It’s good.»
Key Technological Advances
- Real-Time Visibility: Advanced analytics provide treasurers with real-time insights into liquidity, cash flows, and repayment schedules.
- Enhanced Forecasting: AI-powered tools enable more accurate cash flow predictions, supporting strategic decision-making.
- Standardised Practices: Standardised file formats reduce manual work and improve operational efficiency.
- Automation: Automating routine tasks allows treasury staff to focus on strategic priorities.
Europe has led the way in leveraging open banking and APIs, revolutionizing instant payments. Gareth Wilson, Head of UK Banking & Capital Markets at Capgemini, highlights the shift: «Open banking and APIs have exponentially increased the level of data and information available to the treasury function. This data opportunity enhances financial forecasting, putting organizations in a better position moving forward.»
In summary, banks and fintechs are revolutionizing corporate treasury, providing tools and technologies that enable strategic contributions to business growth and resilience. For treasurers, the collaboration offers a clear path to navigating the future of finance with agility and precision.