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Bank to the future: Treasury services and virtual accounts

20th Sep 2022
Banking is arguably one of the most exciting transformational spaces within financial services currently. It has the power to enable businesses who embrace banking technology and use it as their foundation for the way they work to emerge as leaders in a constantly evolving landscape.

Paul Fosse, Group Head of Banking & Treasury, will be appearing at the EuroFinance International Treasury Management conference in Vienna this week to talk about JTC’s own transformational virtual accounts project in partnership with HSBC.

Here he looks at the wider industry including trends, cryptocurrency and the need to retain the personal touch.

Nobody has a crystal ball

I am increasingly asked what I think the future of banking might be. If you had asked me 10 years ago, I would have told you cheques would be long gone by now, so what do I know?

In a relatively short space of time, the banking sector has already seen major changes. Statements are indications of this pace of change. Previously we would only see a bank statement monthly when it arrived in the post. This progressed to getting a mini statement from an ATM/cash machine, then to logging onto internet banking and now to instant access 24/7 on a mobile phone. It is phenomenal how much change has already happened that is easily taken for granted.

The reason I feel strongly about banking creating the future foundations of the industry is that, with the right approach to day-to-day middle office functions, organisations can focus on servicing clients better by offering value added features such as cash forecasting, diversification, FX and pooling opportunities.

Banks and other financial institutions seem to be really focusing on this area too, creating ever more opportunities to innovate and collaborate.

Only a few years ago it was difficult to contemplate professional service firms like JTC having direct connectivity with many of the banks, without using each of the bank’s separate internet-banking sites to review information and make instructions. When scaled up through multiple client and banking relationships, these simple processes are extremely time consuming and inefficient.

With the investment made in technology within banks themselves and firms like JTC and their partners, we can now harness technology to remove the need to log onto numerous internet banking sites and duplicating banking processes. Banks are now actively offering direct connectivity via either SWIFT, Secure File Transfer Protocol (SFTP) connections and/or APIs, which removes many of the manual processes, duplication of effort, and reduces the risk of potential human error too.

We are working in an exciting and fast-paced environment, which embraces both new and established technology to remove time-consuming manual process and harness the banks technology to integrate directly with our Treasury Management Software (TMS). This approach is increasingly allowing us to focus more time on building client-focused cash management solutions that helps diversify client funds and achieve more competitive rates in an extremely cost effective way.

Rise of the machines

The technology revolution we are currently experiencing may be exciting, but it is important that professional service firms, banks and other financial institutions never lose sight of the client and the critical importance that people and relationships play.

Relationship management teams play a vitally important role in the modern approach to banking that technology will not be able to replace, at least as far ahead as I can see today.

Looking longer-term, Blockchain technology in the cryptocurrency space is an exciting development, which has been around for a lot longer than most people realise. The banking space will continue to adapt and in time I believe such technologies could significantly improve the way we all interact and operate with each other. It will be exciting to see how industry household names either react, embrace or are left behind in this constantly evolving landscape.

Permanent evolution

The future of banking is about embracing the technology available to us, changing the way in which we interact, while challenging the way we work too. By adopting available banking technology to remove the manual, time-consuming processes, we will see less reliance on each of the bank’s separate internet-banking sites, as well as the removal of constant duplication and rekeying.

Successful banking and treasury teams should never be content with their primary goal, as they need to be reactive to keep up to date with the ever-evolving landscape that requires us to challenge the way we have previously worked while embracing exciting technological advancements.

Let us not forget finally saying goodbye to cheques too.

 

If you would like to discuss any aspect of this article or treasury services provided by the JTC Group, please get in touch with Paul directly.

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