SEPA (Single Euro Payments Area) set the corporate payment landscape into motion to harmonise payment formats and instruments. The standard improves the efficiency of cross-border payments and creates a single market for euro payments. In order to ensure SEPA compliance and benefit from its new rules, treasurers (particularly those in Europe) are continuing to adapt their payments processes and systems. Some are leveraging the benefits of Software-as-a-Service (SaaS) solutions for Treasury and Risk Management (TRM) to maximize ROI of their payments investments.
According to a recent Reval survey, 93 percent of treasures do not stop at the mandatory SEPA minimum, but have strategic payments initiatives on their agendas for the rest of year. Leveraging the knowledge from the SEPA implementation projects, treasurers try to:
- Reduce the number of bank accounts to increase cash visibility and save account fees
- Bundle payments to save actual transaction costs
- Review and reduce distinct payment channels to reduce manual errors and increase efficiency
- Integrate collections to add transparency throughout the lifecycle of cash, and
- Review bank relationships to ensure the best strategic and geographic fit.
Acknowledging that technology is an enabler for change in treasury, 66 percent of respondents to the Reval survey are planning investments in new payments technology. When allocating their technology budgets, then, treasurers should make sure they are considering:
- Integrating payments structures, processes and systems
SaaS TRM solutions can provide a flexible, independent solution for bypassing the fragmented payment infrastructure many corporations have created through mergers and acquisitions or expansion into foreign markets. Sitting on top of ERP systems and being able to replace disparate e-banking products, SaaS TRM solutions help to:
- Centralise payments management
- Standardise and automate payments processes, and
- Implement payment factories or netting concepts.
- Integrating cash, treasury and risk management
In addition to creating a positive ROI within a few months by optimising payments management, SaaS TRM solutions combine treasury and risk capabilities in one system. Instead of using several different systems, which commonly comes along with a huge number of interfaces and manual workarounds, and spreadsheets, these platforms provide:
- A single point of entry to all financial information
- Visibility into global cash flows
- Control over enterprise-wide risks, and
- Integrated analysis, reports and dashboards to align finance and business strategies.
Rather than investing in stand-alone payments solutions, treasurers should take a holistic view at their systems landscape. In doing so, they can reduce the number of systems and eliminate spreadsheets. By considering a single, comprehensive and integrated SaaS TRM solution, they not only will gain the classic capabilities of a TMS, but they also will ensure a well-defined “integration” plan – both from an organisational perspective (structures, processes, systems) and a functional perspective (cash, liquidity and risk).