Real-time treasury has moved from vision to reality, says new Deutsche Bank publication

New Deutsche Bank white paper argues that the technology and market infrastructure for creating a real-time treasury are now widely available

London, Frankfurt am Main – 30 August 2018

The vision of a real-time treasury – incorporating not just instant payments, but real-time liquidity management, FX management and cash-flow forecasting – is rapidly approaching reality, according to Deutsche Bank’s white paper “The road to real-time treasury”. The paper takes in the views of a number of treasurers through case studies, interviews and surveys, and explores how the ongoing shift to real-time treasury is well under way, with the fundamental technologies for functions such as real-time FX conversion and hedging and real-time cash-flow forecasting already in place.

“Many treasurers see real-time treasury as a long-term vision – nice for the futuregazers, but with no short-term, practical implications,” says Shahrokh Moinian, Head of Cash Products at Deutsche Bank. “This is far from the truth. There are tangible steps that treasurers can take now to start building their real-time treasury capabilities – whether it’s integrating instant FX conversions and even instant hedges, or establishing instant cash concentration through solutions such as virtual accounts. These solutions can all add value today.”

According to Euromoney’s “Treasury Non-Stop: Excitement builds for real-time” survey, commissioned by Deutsche Bank, there is a groundswell of demand for real-time treasury capabilities – with almost 85% of respondents stating that they would value the ability to move cash around the clock and in real time. Just under 87% believe that 24/7 instant payments will have a positive impact on liquidity planning, forecasting and placement.

“For us, it’s a question of letting the market know that most of the technology needed to power real-time treasury is already available,” says Paul Cuddihy, Director, Cross Product Solutions, at Deutsche Bank. “Real-time payments and Open Banking are already being combined to remarkable effect – enabling solutions such as “push” payments, which can reduce transaction fees and eliminate traditional settlement periods of two to three days incurred by merchant acquirers.”

“The goal is within reach,” concludes Moinian. “Industry bodies have laid the foundations with instant payments schemes and Open Banking regulations, while SWIFT’s recent global payments innovation (gpi) for corporates pilot serves as a readymade real-time treasury solution – enabling businesses not only to initiate and track cross-border payments to and from multiple banks in a single format, but also to integrate these flows into their ERPs and TMSs.

“Whether it’s been noticed or not, the industry has assembled the pieces for businesses to begin constructing their own real-time treasuries. For treasurers, it’s a question of reaching out to their partner banks and working in tandem to piece the jigsaw together.”

Contributors include Shahrokh Moinian, Head of Cash Products at Deutsche

Bank, Carola Schmitz-Becker, Vice President, Corporate Treasury, Deutsche Post, Boris Jendruschewitz, Vice President, Corporate Finance, Otto Group, and Paul Cuddihy, Director Cross Product Solutions at Deutsche Bank.

To read “The road to real-time treasury”, please click here.