Improving Bank Connectivity Through Automation
An active treasurer needs to review the companies’ bank accounts two to three times a week, assuming they work for an SME with a turnover of approximately €200m and have 20 bank accounts across Europe. To prepare a more efficient solution for bank connectivity, a treasurer should be able to answer the following questions:
To find an appropriate bank connectivity tool, treasurers should have information about these issues. In order to ensure that the data is up-to-date, companies should be able to answer the following questions positively:
E-banking is definitely not the right tool, except if a bank account is used only once a quarter and its charges for connections are high. E-banking is a tool for individuals, not companies. Just imagine if a company has 20 bank connections, it would need 20 different log-ins and passwords and there is a risk of misuse, e.g. storing the passwords in a drawer of an employee’s desk.
The most variable factor in this entire process is the amount of working time needed for bank connectivity, to assess this treasurers should answer these questions:
Again, accessing 20 banks two to three times a week takes up half a working day with log-ins, downloads and consolidation of the data into one form. This leads to the next question: what is the minimum time I need to invest for bank connectivity per day or per week? The answer is: no manual work should really be required. Today, log-ins and downloads are executed automatically. If a machine or software can do this work for treasurers, this is a major benefit and can save them valuable working time. There are solutions that can frequently dial into a company’s bank accounts and download the transactions and balances. Then, also through automation, this information is sent to all relevant staff.
Now it is time to convince the CFO, accountants and also IT for such a step and this won’t be easy. Start with a simple concept to see who is ready for fully automated bank connectivity. The concept should include a chart outlining today’s fragmented situation, the use of many manual workflows, and the use of highly qualified people spending a certain amount of their precious time to connect to bank accounts. Map all the missing IT links between the systems, listing the people who are currently working on these links manually. On each link, the amount of time, cost of labour and potential errors (risk issue) need to be explained.
A second chart should show the future situation with the planned solutions for closing most of the gaps. It is important to remember that at this point there is no need to discuss money and objections – this is exclusively the time to outline your needs.
Once some of the internal parties are convinced, it is time to shop for ideas and look at the basic costs. First ask your banks for solutions. Second, check with neighbouring treasuries and find out what they have. Then search the Internet for offers from third-party companies. It is impossible to make general recommendations so allow time to gather information.
Be prudent in your professional life and give yourself more quality working time as a treasurer. From our 25 years of experience, we found that CFOs, treasurers, chief accountants and accountants are all led by the same principle: save money. This means never spend more money than is absolutely necessary for today’s business. However, far-sighted cash management investments and solutions always pay off quickly and it is always worth investing money in solutions that improve treasury’s efficiency.