AI, coupled with other relevant technologies, is all set to disrupt the conventional work culture of treasury management in banking.
FREMONT, CA: The exponential growth of new technology services and solutions is transforming the industries indiscriminately. Artificial intelligence (AI) has been one of the most influential technologies in the past few years and has resulted in the disruption of a number of processes across the industry verticals. The financial and corporate sectors are not alien to this trend either. Treasury management in banking is one of the many banking aspects that has benefitted from AI capability.
While the short term implications of AI in treasury management processes may be limited, the capability will profoundly improve treasury management in the long run. The ability of AI algorithms to access a vast array of data and to extract crucial business insights from them makes it essential in treasure management. For instance, the powerful AI algorithms can optimize hedging strategies and cash management as well as ensure machine executable regulatory compliance. AI-driven predictive analytics can also help the treasurers to enhance their procurement processes, sales forecasts, as well as supply chain management.
Modern treasury management systems are leveraging data mining as well as AI-based analytics on data sets containing all kinds of collections and payments. Such insights are later being used to reduce the need for working capital as well as to lower transaction costs. The combination of AI and data mining are also enabling bankers to identify better metrics to measure treasury performance. AI’s incorporation will also lead to the automation of some of the redundant tasks of the employees working under the treasury management department. Thus, the employees can be engaged with high-value work, thereby enabling the banks to enhance their workforce efficiency.
Moving forward, AI has immense potential for treasury management in banking. The coupling of AI with progressive technologies will also streamline the processes in treasury management. Thus, it is essential for treasury managers to think about AI-compatibility while making technology purchase decisions.