Our innovative cash management institutions have all introduced new products and services that provide clients with greater flexibility and control over their cash flow.
Uncertainties raised by Brexit and a wave of global trade disputes were forcing companies to assess their cash flow management even before the coronavirus accelerates the need for liquidity visibility. The fact that many banks and businesses are now operating remotely puts additional pressure on their capacities. Application Programming Interfaces (APIs) enable banks and their corporate clients to access the best solutions at lower cost and with faster implementation. They also provide flexibility, allowing treasurers to pay only for the services they use, but increase later as needed. Flexible solutions help businesses manage their cash flow capacities; companies that can provide them may have a competitive advantage in the future.
The common denominator of this year’s most innovative cash management banks is that their offerings put the power in the hands of customers, giving corporate treasurers greater flexibility and control over their cash flow.
Abu Dhabi Commercial Bank’s Virtual Accounts Phase 2 API integration, for example, promises the flexibility to open, edit, close and monitor large numbers of virtual accounts in near real time. Improving the reconciliation of financial statements that cover many customers and suppliers, by creating virtual accounts under a single physical account, promotes clarity and cost savings without compromising functionality or reporting, according to the ADCB.
ING’s zero-knowledge proof notarial service, which runs on the Corda blockchain, can assess the validity of a transaction without revealing anything about it, unless it is valid. “Even with the use of authorized private registries, we believe there are still key privacy challenges to be addressed when it comes to DLT,” says Benoît Legrand, Innovation Director at ING. “For example, in the Corda consensus, a choice must currently be made between a validating notary and a non-validating notary, and with that a compromise between security and confidentiality.”
Instead, he says, with zero proof notary, “we can ensure both the accuracy of a transaction as well as the confidentiality of its content in the consensus process. In addition, we also plan to develop the solution further to also offer a privacy solution for historical transactions, in particular the provenance chain that follows a transferred asset. “
Adapt with APIs
Immediate settlement and accurate information management are two attributes that corporate treasuries will focus on adapting their cash management operations to new standards arising from the Covid-19 pandemic, explains Raof Latiff, digital manager at DBS Institutional Banking Group. “At DBS, our suite of digital solutions enables real-time payments and collections, improves forecasting accuracy, facilitates automated reconciliation and strengthens the management of customer credit extensions,” he says. “With our range of APIs covering various types of services, customers can also plug and use banking services in their systems and processes efficiently, without high capital costs and without technical integration. This has allowed our clients to better control their cash flow, optimize their working capital and deepen their relationships with their main suppliers.
We’ve selected two DBS Quick Response Code (QR) innovations that simplify both payments and collections. DBS MAX Business2Business facilitates cashless and immediate collections via QR codes from retailers, while at the same time enabling real-time credit confirmation and automated reconciliation. DBS MAX Client Integration is a QR collection solution that enables merchants to generate and display a dynamic QR code on their trading platforms to facilitate instant national collection and payment capabilities.
First Abu Dhabi Bank’s Global Cash Position mobile app offers near real-time visibility. Customers of several banks in UAE and around the world can view cash positions worldwide by bank, product and various currencies. The application includes an exploration function to display the balances of individual accounts; while executives can view aggregate liquidity positions across the group in seconds, eliminating the need to log into the electronic banking platforms of many banks.
Integration for the opportunity
Bank of America has integrated an Apple Watch token app into its CashPro ecosystem, allowing mobile users to pair their Apple Watch with their mobile token to generate a one-time password so they no longer have to jump between two or carry a physical token. This means treasurers can check balances or approve a payment anywhere they use their Apple Watch. BofA users reportedly completed $ 160 billion in mobile transactions in 2019, including a $ 1.6 billion transaction executed through CashPro.
BofA has also added to its exchange rate / payment solution, FX Trade and Pay, allowing users to trade via API and settle via Swift, or trade via mobile and settle online, for example, to manage their payroll. global and their subsidiary funding operations. APIs also help correspondents make competitive FX payments, according to BofA, by allowing payment processors to leverage FX Trade and Pay.
Security Bank Corporation’s Salary Advance (salad) app is a fully automated mobile instant payment service, providing customers with 24/7 cash access. Employees can request payday advances via SMS and the loan proceeds are credited to their payroll account within 10 minutes.
Taishin Bank’s direct-link API platform, iHUB, enables the Taiwanese bank to offer new products and services, including real-time automatic and multi-channel payments. Taiwan has many different payment channels, each with their own verification rules and deadlines; IHUB API modules allow customers to use all of these channels according to their needs. For example, by connecting the three major convenience store payment systems in Taiwan to iHUB via API, customers can generate and pay their bills on their mobile devices at any time. Before logging into iHUB, convenience stores needed at least five days from the delivery of a paper invoice to reconcile a store account.
Another bill payment solution, that of Kotak Mahindra Bank, C2B will operate on the back of BBPS-BOU (Bharat Bill Payment System — Biller Operating Unit), the one-stop payment platform of the Reserve Bank of India, to offer to consumers the ability to pay interbank bills. Additionally, Kotak Mahindra’s launch of an updated version of the United Payments interface from the National Payments Corporation of India allows customers to request recurring payments. Integrating this capability with BBPS-BOU creates a powerful collection solution for Kotak’s corporate clients.
In such solutions, APIs act as a bridge between banks and third-party applications. As APIs share real-time data, they also give businesses a real-time view of their cash position across their banking relationships. Since APIs don’t require endless banking connections, they save time in addition to delivering quality cash flow data in real time. It is an innovation that benefits both banks and their customers.
Cash management innovators 2020
|Abu Dhabi Commercial Bank||Integration of the API of phase 2 of virtual accounts|
|Bank of America||Improved FX trading and payment|
|Apple Watch token app|
|DBS||DBS MAX Business2Business|
|DBS MAX customer integration|
|Abu Dhabi’s leading bank||Global cash position mobile application|
|ING||Notary Zero-Knowledge Proof on Corda|
|Kotak Mahindra Bank||C2B platform|
|Philippines Security Bank||Payday advance from the security bank (SALAD)|
|Bank of Taishin||Taishin Direct-Link API – Smart Checkout and Cashout|