B Y
M A D H V I
The Future of
Treasury
Here are some insights into what a few treasury management
systems providers are predicting for the future.
DO YOU BELIEVE THAT TREASURY IS TRULY
BEING INNOVATIVE IN 2016?
Philip Pettinato, Chief Technology Officer, Reval:
Innovation, while really a relative term, generally means
coming up with a better way of doing something you do
now. In that respect, I think many companies are turning
to treasury technology to help them better manage treasury
and risk. Companies that are creating a global technology
platform are, in essence, laying the foundation for further
innovation. We are seeing new implementations of in-house
banking structures, enabled in the cloud, which will help
them optimise their resources internally and externally in
ways they couldn’t before. This cloud-based foundation
is enabling treasury organisations to respond nimbly to
regulatory pressures, market events and growth, spending
M A V A D I Y A
time on analysis that is actionable rather than on gathering
data that is out of date by the time they complete
the task.
Anis Rahal, CEO, TreasuryXpress: From my perspective,
2016 was the most innovative year I have ever witnessed in
treasury. This year, I have observed what I’m going to call
the API revolution. With so much innovation by talented
and innovative startups, it has now become easy to connect
treasury to the systems and services it needs to make a
treasurer’s job easier and more resource-effective. Take
market data for instance. Prior to 2016, treasury had to rely
on very expensive direct market data platform or they had to
deal with resource-heavy data services and integrations from
their TMS provider. Today, there is a spirit of accelerated
and relentless innovation in the fintech startup space which
opens up the opportunity for TMS providers.
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Peter Schädelbauer, Head of Product Management,
Hanse Orga: I believe that treasury is in evolution, but not
in revolution. Things have to be done step by step. There will
be many new possibilities through technology and software
solutions, with big data, but it will take some time to adopt
all of this accordingly.
WILL THERE EVER BE A FUTURE IN WHICH
TREASURERS DO NOT USE SPREADSHEETS
FOR CASH MANAGEMENT?
PP: Spreadsheets are a valuable tool to analyse data – they
are not a processing platform, especially not the kind of
platform global treasury organisations need. Many treasuries
are using spreadsheets for operational tasks, but spreadsheets
were not designed for this. They don’t provide the right
controls and are not the source of data, which people turn
them into; they are just for retrieval and analysis of already
integrated data.
AR: I believe the purpose of the spreadsheet has changed
and will continue to evolve. It will no longer be used for
calculations, but it will still continue to be used visually and
for information sharing. I was a treasurer for many years
and I love spreadsheets. Treasurers love spreadsheets. They
understand spreadsheets, but that doesn’t mean they need to
or should do their actual work there.
PS: In my opinion, in the near future we can expect to have
a real time cash position worksheet that is fully interactive
with all the necessary information available. Spreadsheets
will not be necessary then.
HAS THE CLOUD REVOLUTION ENDED, OR
HAS THE EXCITEMENT MOVED ON TO OTHER
TECHNOLOGY?
PP: The hype has ended, but not the revolution. Cloud
has definitely gone through its hype cycle, where there are
now many different applications of cloud technology that
are proven to add tremendous value. So, it is not so much
whether people are moving onto the cloud, but what new
technology will evolve out of the cloud itself that will enable
value, efficiency, and more capabilities as businesses use it
over time. For example, mobile couldn’t happen without
cloud. Treasury right now is in the process of replacing
legacy systems with cloud-based technology. There is a
paradigm shift in treasury technology every 15 years, so I
would say this is the beginning phase of that shift to the
cloud for treasury.
AR: The cloud revolution has not ended but it has changed
dramatically. With the advent and innovation made in the
private cloud space such as Amazon Web Services and
Azure, companies that have been steadfastly server-based in
their infrastructures are now moving their environments and
operations to the Cloud.
PS: Cloud was never a revolution for me, it was just
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another way of doing things. Cloud will become more and
more important but I still believe that companies will not
complete all critical processes in cloud solutions. Blockchain
is in the spotlight now, as well as big data.
IS BLOCKCHAIN STILL A MYSTERY TO
TREASURY?
PP: I can see the value in applications such commodity
trading or even currency exposure netting – where people
are sharing a chain of transactions, like moving physical
commodities – but the jury is still out on whether it is the
right technology to support these types of applications.
Although innovation with blockchain is advancing, I believe
it is some ways off in treasury.
AR: Yes, it is a mystery but it is inevitably coming. When it
will arrive is yet to be seen as there is uncertainty is around
the regulations. There is also still too much ambiguity on
how corporate treasurers will be able to monetise it.
PS: Blockchain is not a mystery, but at the moment
treasurers are not given direct access to it. As the treasury
department is strongly related to banks, it may take three to
five years for blockchain to become a part of daily business.
WHAT ARE YOUR PREDICTIONS FOR THE
FUTURE?
PP: Software is becoming simpler and easier to use. It is
increasingly taking care of the detailed work while users
spend their time gaining insight and taking action. This is
especially the case in treasury as companies become players
on the global stage, participating in M&A, responding
to developments that continuously effect the markets.
Treasuries are turning to the technology that will progress
as they progress, helping them better manage transactions,
measure risk and respond to volatile and dynamic markets
and new regulations. In both our consumer and our business
lives, the proliferation of data from the Internet of Things
will continue to drive technology innovation. We will
need new ways to make sense of that data to add value to
our lives. Technologies that add true value are always the
winners.
AR: Treasury and TMS connectivity will continue to
become more frictionless. What I mean by that is that
TMS’ will or should become lighter. By lighter I don’t
mean less capable, I mean that they will be more flexible,
accommodating, and affordable which actually makes them
even more capable. By leveraging new, cutting-edge APIs
to de-clutter their resource-intensive integrations effectively,
treasury teams will be able to perform at higher, more
scalable levels.
PS: Because of big data and other new solutions becoming
standard processes, other systems will be automated so that
the treasurer has time for more important tasks and we will
see a new way of working.