Cash Management: The next big thing which has already been there

Susanne Prager, Head of Group Cash Management, Raiffeisen Bank International (RBI)

The fascinating fact about Cash Management is that this Corporate Banking discipline has been rapidly evolving from the start – and will remain doing so. This is true for both the permanent development of new Cash Management products as such (e.g. the introduction of SWIFT gpi and global payments tracking bringing revolutionary transparency to corporates) as well as the reinvention of underlying infrastructures.

I currently see three inspiring trends in Cash Management, which are even more important for banks operating in multiple countries and serving clients on a cross-border basis like RBI, which is present in Austria with its head office and 13 Central and Eastern European countries by means of subsidiary banks (additionally, the RBI Group comprises numerous other financial service providers, for instance in leasing, asset management or M&A).

Trend One: Open Banking
Open technical interfaces (“APIs”) are key facilitators of data exchange and enable real-timevisibility, instant initiationand processing as well as intelligentbanking.We clearly see that APIs are gaining traction, with specialized corporateofferings increasing across various aspects of the treasury area.

On the consumer-side attention risesas well – customers have increasing interest in bank APIs, althoughmany are still in an early stage of exploring the technology. In fact, the corporate API market is still immature but growingrapidly, and leading banks are now stepping in and making the pace.

Trend Two: Real-Time Treasury
Which brings me to the next trend, partly already enabled through Open Banking, and this is the execution of treasury jobs on an instant (i.e. real-time) basis. It is crucial to enforce the digitalization and automation of manual processes, including the automation of various paper-based/manual workflows like onboarding/KYC processes,account/user management as well as trade finance processes.

A general trend observed is that treasurers seek to manage all their bank-related treasuryjobs across multiple banks in one system/application (one-stop-shop). This multibank approach can also be reinforced by APIs.

The clear vision is to transform from operational treasury to strategic (real-time) treasury functions. Classical bank account management needs to be reinvented by dynamic balance sheet management, while the management of bank relationships needs a strong acceleration via ecosystem partners like ERP-systemproviders.

Trend Three: Data Analytics
Data is the new gold – if this provocative phrase is true, it definitely relates to Cash Management. And this does not refer to banks using their client-data for different business opportunities, but to utilizing the data in favor of the clients.

And there are various data analytics examples in the Cash Management domain, one is connected to a very prominent topic: ESG - Environmental, Social and Governance. Still in a very early stage, socially responsible banking is increasingly becoming essential for Cash Management. In future, we can support treasurers by increasing their own corporate ESG efforts. This could for instance come through supporting paymentdocumentation taking theESG-conformity of the transactions into account and reporting this back to the customer.In the end, corporates as well as financial institutions can improve their ESG footprints by selecting the right bankingpartner committed to responsible banking.

That is why RBI decided to sign the UN Principles for Responsible Banking – asthe first bank in Austria. As responsible bankers, we support our customers in Austria and CEE with sustainable financial products, and our focus on CEE and ESG starts to translate into measurable success and top market share.According to the Bloomberg league tables for the first half of 2021, the RBI Group ranks first in sustainable bonds by both volume and number of transactions in Austria and CEE and is also No. 1 for Corporate Bonds (including financial institutions and excluding self-led transactions) in CEE by volume.