Caution Still Reigns on Cash

Treasury & Risk’s 2012 Cash Management Survey shows companies continue to tweak short-term investments.

As the European debt crisis casts a shadow over global economic growth and the outlook for the euro, companies continue to tweak their short-term investments. According to Treasury & Risk’s 2012 Cash Management Survey, which was conducted prior to the Securities and Exchange Commission’s cancellation of its vote on money-market fund regulatory changes in late August, 29% of respondents say they’ve put in place a more restrictive investment policy over the last year, while 22% have tightened enforcement of their investment policy.



Asked specifically about how they will respond to the scheduled expiration of unlimited FDIC coverage on non-interest bearing accounts at the end of this year, a majority (53%) of companies say they don’t expect to move company funds out of checking accounts when that coverage goes away.










Increases in bank prices were in line with what finance executives reported last year, with 38% saying they are being charged more for cash management services, vs. the 41% who cited price increases in the 2011 survey.









A decline in service was the biggest issue companies are having with their cash management banks, cited by 29% of respondents this year, overtaking last year’s top issue of linking treasury to broader financial initiatives, such as A/P, A/R and EIPP, for which banks offer solutions.










As the countdown begins to the February 2014 deadline for implementing the Single Euro Payments Area (SEPA), 16% of companies with operations in the European Union say they’ve adopted SEPA credit transfers, while 12% have adopted SEPA direct debits.

















And in a nod to connectivity, more companies are employing SWIFT, with 29% saying they use SWIFT or plan to connect to SWIFT in the next year, up from 18% in 2011.









Moreover, 37% say they intend to use SWIFT for electronic bank account management when their bank can receive those messages, up from 28% in 2011.

Almost 200 finance executives responded to the survey, which was conducted between July 11 and July 23.










See the full results of the 2012 Cash Management Survey here.






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