RegionsNorth AmericaSurvey shows treasury professionals split on automation

Survey shows treasury professionals split on automation

Stagnant corporate systems, cybersecurity continue to plague treasury professionals, TD Bank survey finds.

Cybersecurity and technological solutions are top of mind for finance and treasury professionals, according to a survey conducted by TD Bank at the 2019 NACHA PAYMENTS conference.

Notably, 42% cited organizations’ struggles to improve legacy systems as the greatest challenge facing payments professionals today, up from 36% last year. Increased frustration shows minimal efforts have been made over the past year to improve payments and processing systems.

Other significant findings include:

  • Accounts payable (A/P) automation and Straight Thru Processing (STP) of payments are two elements greatly hindered by such antiquated technology: 26% do not yet have any payments automation or STP
  • 56% said it will take at least one year to implement real-time payments; only 22% stated that they will participate in real-time payments within the next year

Cybersecurity concern

The survey of 498 financial professionals showed that cybersecurity is a top concern for treasury professionals, with 62% of respondents placing cyber fraud growth in their top two challenges for the year. What’s more, 85% anticipate fraud and cybersecurity threats to grow over the next two years – up just 1% since 2018.

To combat fraud, most respondents (88%) thought that their organisation should employ security in-house, with just 12% wanting to outsource security. For in-house cybersecurity, 53% wanted to protect internal networks and 23% desired employee security training for anyone handling sensitive information.

Interestingly, a small portion of respondents (12%) wanted to test their employees’ cyber fraud knowledge in-house by sending out deliberately-made phishing emails.

Additionally, while Brexit is a major concern for financial professionals in the UK, the survey’s respondents did not seem concerned about the upcoming changes outside of cybersecurity.

Only 11% were concerned about cross-border transactions, with a lowly 6% concerned about GDPR and/or PSD2’s challenges.

Embracing automation

The finance industry seems split on embracing automation, with only 23% of professionals reporting that their company had achieved full automation and Straight Thru Processing (STP).

An additional 28% reported that their company is using both automated and manual processes as it works to achieve automation in the future, with 26% using only manual processes.

Rick Burke, head of corporate products and services at TD Bank, said: “Payment capabilities currently are changing at a rate that organisations cannot yet accommodate, so lagging adoption of fully automated processes within corporations is an expected outcome.

“Although the need to adopt new payment methods is a global pressure from an efficiency and security standpoint, faster and automated options do not yet have a foothold within many U.S. organisations.”

Real-time payments are still difficult for many firms, with only 22% of respondents set to use them within the next year and over half of respondents (56%) needing over a year to implement the payments.

However, this is set to change, as the US is catching up to other countries on real-time payments, thanks to discussion across banks, lawmakers and financial professionals, according to Burke.

“It will be interesting to see how faster payments evolve over the next few years, especially with the Federal Reserve’s announcement that they will develop a new real-time service called FedNow,” Burke said.

The FedNow Service is set to launch in either 2023 or 2024, offering real-time payments to the financial services industry. When established, it will match the systems that Europe, Mexico and Australia currently have, growing the global digital economy.

Whitepapers & Resources

2021 Transaction Banking Services Survey

Banking 2021 Transaction Banking Services Survey

CGI Transaction Banking Survey 2020

CGI Transaction Banking Survey 2020

TIS Sanction Screening Survey Report

Payments TIS Sanction Screening Survey Report

Enhancing your strategic position: Digitalization in Treasury

Payments Enhancing your strategic position: Digitalization in Treasury

Netting: An Immersive Guide to Global Reconciliation

Netting: An Immersive Guide to Global Reconciliation