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Alexander Hamilton Awards

APIs Automate Booking of Payments that Defy Standardization

Here’s how Baird won the 2019 Silver Alexander Hamilton Award in Technology Excellence.

Baird is a full-service financial firm with more than US$200 billion in assets under management and operations across the United States, Europe, and Asia. Despite the company’s global reach, its three-person treasury team also handles accounts receivable. That’s a critical function for the client-focused business. Unfortunately, in 2016, receivables processes were largely manual, and staff sometimes had trouble keeping up.

Every day, customers send hundreds of ACH payments and wire transfers to fund their Baird investment accounts. “When these payments come in, we need to post those funds to their accounts as soon as possible,” explains Steve Huse, director of client reporting at Baird. “We work in a real-time environment, with wires coming in throughout the day. These payments are very time-sensitive—they might meet a margin call or fund an imminent purchase. Our financial advisers might be waiting for the funds to hit the customer’s account so they can put that money to work in the market.”

To keep up, treasury staff would log onto their banks’ portals repeatedly throughout the day and pull down BAI files containing information about incoming wires. “We would ask for payment data in a standard format,” Huse says. “Our institutional clients were typically pretty good about complying, but our retail clients would send information in all kinds of formats. The team would get bogged down with trying to figure out how to properly apply payments to customer accounts and book them in the general ledger.” The lean team was spending about half of a full-time equivalent (FTE) position on ensuring incoming electronic payments were booked properly.

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Meg Waters

Meg Waters

Meg Waters is the editor in chief of Treasury & Risk. She is the former editor in chief of BPM Magazine and the former managing editor of Business Finance.

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