bankingciooutlook

Key Features of Treasury Management Software

Banking CIO Outlook | Monday, January 31, 2022

A bespoke treasury management system of ordinary complexity takes 6–12 months to create, whereas a high-end solution might take up to a year to build.

Fremont, CA: Treasury management software integrates a myriad of treasury functions, covering cash management, investment, debt management, trade finance, and risk management. ERP, accounting software, bank accounts, trading platforms, and other systems integrated with a treasury solution.

A bespoke treasury management system of ordinary complexity takes 6–12 months to create, whereas a high-end solution might take up to a year to build. Depending on the intricacy of the solution, custom treasury software might cost anywhere from 200K to 400K dollars.

The return on investment for custom treasury management software might be as high as 280 percent. A bespoke treasury system has an average payback period of roughly five months. Let’s have a look at some of the key features of treasury management software.

Cash management

  1. Cash influx and outflow transactions concerning operating, investing, and financing operations are getting tracked in real-time.
  2. Monitoring the progress of a financial transfer (sent, in transit, delivered).
  3. Automated cash transaction categorization (accounts receivable, accounts payable, taxes, payroll, etc.).
  4. Cash balances get tracked across different bank accounts, currencies, countries, and entities, among other things.

Analytics and forecasting

  1. Cash projections are going by past and ongoing cash transaction data and even the company's and customers' payment behavior patterns.
  2. Forecasts of financial benefits from debt and investment operations based on historical and current debt and investment transaction data, as well as financial market data estimates on FX, interest, and credit rates.

Reconciliation

  1. Data on financial transactions given in bank statements get automatically matched with those entered in the ledger accounts.
  2. Cash matching based on predefined rules: one-to-one, one-to-many, and one-to-all.
  3. Establishing outstanding transactions and flagging them for manual reconciliation.

Payment management

  1. Payments to vendors, suppliers, contractors, and others on a regular and ad hoc basis.
  2. Payments of principal and interest on existing liabilities get calculated and scheduled automatically.
  3. User-defined rules assign ideal bank accounts and payment mechanisms (e.g., ACH, BACS) for numerous payment transactions.
  4. Cash pooling in many currencies, POBO and COBO services, and multilateral netting via in-house banking are all available.

 

 

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