Balancing Act: Trends in Treasury Management

In our fast-paced business environment, corporates have to be nimble while keeping payments secure.

In today’s rapidly changing environment, corporate executives are expected to do everything faster—from how they do business to how they communicate with customers. Increasingly, companies are focusing on innovation to gain a competitive edge.

At the same time, consumers expect improvements in how they obtain information, take action, and manage their products and services, putting pressure on companies to speed up their processes to deliver faster than competitors. Think PayPal in the early 2000s. Think Amazon today.

So, how can treasurers react to this faster-paced world when they’re also charged with keeping the company safe? Treasury departments now have access to myriad corporate payment tools. Identifying the right ones to keep ahead of the game while maintaining essential protective measures is the key opportunity.


Accelerating Payments

Corporate innovation follows consumer innovation, and we’re seeing this happen with payments. In the past, most corporates were accustomed to seeing reports, getting confirmations, and managing working capital in traditional ways. Increasingly, corporate treasurers are adopting new ways of doing things using just-in-time processing with enhanced data and payment confirmation and artificial intelligence (AI) to aid in processing efficiency. New payment options are coming online as well: Same-day ACH credits began last fall; same-day ACH debits became an option last month; and real-time payments enter the pilot phase next month.

In this business environment, there is a need to balance the focus on speed with safety and soundness. We are learning how to innovate and take the lead on security issues. Today’s banks are in the business of keeping the so-called electronic cash vault safe and secure for consumers and businesses alike.

Treasurers trust their financial institutions with their workflows and lending. For banks to truly serve as partners to companies, they must maintain that trust by ensuring security as they look to innovate in speed and flexibility.


Beware of Cyber Risks

Because of lax security at one of the major credit reporting companies, the private financial and personal details of as many as 143 million Americans have been exposed to hackers. Just as consumers are taking notice and action to protect their sensitive data, so are corporate leaders.

Increasingly, business leaders from all industries are concerned about the potential for cyberattacks on their companies. The Association for Financial Professionals’ (AFP's) 2017 “Payments Fraud and Control Survey” found that 74 percent of finance professionals were victims of payments fraud in 2016. This is the largest share ever, according to the AFP survey. This suggests that fraudsters are continuing to succeed in their attempts to attack organizations’ payment systems.

It appears that executives understand this new reality. More than nine in 10 corporate leaders (91 percent) believe cybersecurity breaches will have a negative impact on stakeholders’ trust levels in the next five years, according to PwC’s 2017 CEO Survey, which polled 1,379 CEOs in 79 countries. Fully 61 percent of CEOs surveyed believe cyber threats will pose dangers to their own organization’s growth prospects.

Business email compromise, or “impostor fraud,” has become increasingly common. Generally these scams involve a criminal masquerading as a corporate executive, instructing employees to make fraudulent transactions. To prevent such scams, we recommended that corporate treasurers adopt strong authentication measures and security standards. One good example is multi-level authentication, or more than one set of “eyes” handling a transaction either human or electronic.

The criminal also may send a direct instruction to the bank with similar urgency, instructing to go around defined processes such as multi-level authentication, with the hopes that the “direct” instruction will suffice. Effective business banking partners should work with corporate treasurers to thwart fraudsters, training their support team on how to identify and protect against these threats.

To counter fraud, treasurers should also implement positive pay, an online fraud mitigation service that allows you to manage ACH debits and credits posting to your business account via filters and blocks. While additional steps are required to aid in the validation, the added safety measure is worth the time investment.

Cyberattackers constantly evolve their skills and will always find new ways to attack—it’s not a question of “if,” but of “when.” Incorporating advanced fraud analytics within the daily operations of treasury can protect payment processes.


Safe Transactions at the Speed of Light

In the corporate payments world, financial transactions are moving at the speed of light, and trading partners are continuously expecting treasurers to move ever faster. Innovation is coming in the form of accelerated payments.

You don’t have to be a Silicon Valley tech company to innovate. There are tools that corporate treasurers from companies of all sizes can use today to ensure they are safely moving forward with the market as it evolves.



Eileen Dignen is executive vice president, head of cash management at Bank of the West. Dignen is a seasoned executive and senior leader, with a strong background in product management, strategy and development, and sales.



The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Bank of the West.

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