Payments innovation and risk: a corporate treasurer’s playbook

Read the full and original article in Raconteur

PA Consulting's Emma Hollingsworth, payments expert, talks about payments innovation and risk in three articles within a NatWest special report on payments, by Tim Cooper.

Real-time payments – the opportunities and challenges

Commenting on the opportunities and challenges of real-time payments, Emma says: "The increasing availability of real-time payments and alignment of cross-border payments to [international payments standard] ISO 20022, combined with technology such as the Swift global payments innovation, will allow faster access to funds. These developments will improve visibility regarding the movement of money and help to drive corporate treasury forward."

How to harness the power of treasury management systems

The article goes on to explore open banking and enhanced data, to which Emma says: "Enhanced data – for instance, purpose codes, legal entity identifiers and structured addresses – will transform treasury operations, improving their efficiency. New data will enable automated processing, including the matching of payments with invoices to ensure correctness, and also improve analytics capabilities. The more data that treasury has, the better decisions it can make. You need an advanced TMS to use the full set of data available from payments systems via direct API integration with banks’ systems."

Talking about the potential risks and challenges of payments, Emma explains: "As firms share more data more quickly, another risk that firms may need to address is their ability to secure that material and identify possible cases of fraud can be compromised."

She adds: "To address this, organisations need future-proofed, flexible platforms that can balance CX and security. Incrementally modernising legacy technology won’t be enough – a full-scale transformation is required."

Regulations and standards propel a wave of creativity

Emma concludes by commenting on the ISO20022, saying: "With the right implementation, ISO 20022 can enable strategic cash management and improve firms’ relationships with their B2B customers through better data sharing and interoperability,” she says, but adds that “organisations are still largely unaware of these benefits, often because of the complexities in global implementations of the standard. Treasury functions should assess the potential benefits and work these into their ISO 20022 transformations."