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Achieve ambitions of treasury on demand

23 Nov 2021

APIs have been friction points in realising treasury on demand. How can these pain points be removed to enhance decision making in cash and treasury management?

Technology is enabling the long-held vision for treasury on demand. Corporate treasury and finance departments recognise the value of immediacy for connectivity, data and information analysis, and transaction status. 

That value includes information visibility, better decision making, and the optimisation of financial flows and working capital alongside operational efficiency. As a result, organisations have been envisioning a real-time banking environment. 

Real-time connection to transaction banking services just got easier

Banks have contributed to the progress towards a real-time, on-demand treasury by leveraging API technology to build granular utilities that break down banking services into smaller units (also known as microservices). For example, balance and transaction data can feed into various applications immediately and seamlessly via machine-to-machine communication.

Application Programming Interfaces (APIs), as the connectors between such microservices and an organisation’s network of systems, play a key role in the delivery of these real-time treasury services by paving the way for establishing cost-effect and secure system integration between bank and client’s applications. 

However despite these initiatives, achieving an on-demand environment remains challenging and clients are not alone if APIs, as bridges for communication between systems, have been friction points in realising ambitions of treasury on demand.

Common API friction points impeding progress

While the goal of APIs is to simplify connections between systems, the reality is many of the legacy finance and treasury systems in use today are simply not designed for API connectivity. As such, companies are faced with a need to invest in new systems and middleware with all the associated cost burdens, operational process changes, and additional integration requirements these solutions require. It should be no surprise to learn that many struggle to build a supportive business case for such investment.

Further complexity arises with the lack of universal API Banking standards today across banks, and in some cases, within a single bank. For multi-banked corporations, the significant challenge in integrating and managing multiple API format standards and definitions remains one of the most common constraints impeding the adoption of APIs. Under these circumstances, implementation becomes a resource issue for companies wishing to fulfill the vision of just-in-time treasury. Corporate finance and treasury teams must vie for scarce internal IT resources to prioritise and execute API implementations. This turns the promise of just-in-time into “just-wait-awhile-longer”. 

An innovative approach: Making it easy to connect

To remove these pain points for its clients, Standard Chartered has embarked on a partnership with FinLync, a global fintech company founded in Singapore, to enable corporate treasury and finance teams to connect to Standard Chartered’s API-based services rapidly and easily.  

The partnership provides a simple plug-and-play process. Standard Chartered’s applications pre-integrate with FinLync, and there are no additional interfaces with third parties, such as middleware, or cloud providers. Migration takes only a couple of weeks for a full integration that provides access to the Bank’s comprehensive suite of APIs.  

Supporting real-time treasury management

Standard Chartered has developed a number of business-critical direct client APIs, including real-time balance inquiry, debit and credit notifications, payment initiation and payment status tracking. “We recognise the need for clients to connect to these APIs quickly, securely, and easily, to fully gain the benefits of a seamless connection,” says Philip Panaino, Global Head of Cash Management at Standard Chartered.  

With the FinLync partnership, clients can gain easy access to new capabilities through existing SAP ERP systems and treasury workstations. “FinLync’s technology directly embeds account data, via bank APIs, into any clients’ ERP platform, especially for SAP, providing real-time visibility into account data and cash positions,” adds Phillip Klein, Co-founder and Chief Executive Officer of FinLync. Real-time data, harmonised across various applications, supports fast, accurate analysis that enhances decision making around cash and treasury management. 

This is a fundamental change to the banking experience because it enables quick API integration, easy multi-bank access, and a suite of transaction banking applications to support treasury activities. For example, instead of waiting for balance and transaction information to arrive periodically or at prescheduled times, the approach enables clients to access banking information when needed, through the desired applications. The solution automatically and securely applies existing authorisations and permissions to information that flows through an ERP system.  

Clients can choose to eliminate file-based, host-to-host, and SWIFT connections with the Bank.  However, the solution also supports multi-channel connectivity, accommodating legacy host-to-host and SWIFT connectivity in a multi-banking environment.

Arriving at the future of treasury management

This partnership and capability is part of Standard Chartered’s continued co-evolution with clients towards a full on-demand banking and treasury experience. Clients will benefit from the Bank integrating and enabling a wide variety of additional applications, such as account management and trade finance, into an expanding universe of capabilities that support on-demand treasury.

How one company plugged into multi-banking via APIs

Mapletree is an international real estate company based in Singapore with offices in 13 markets across Asia-Pacific, Europe, the UK, and the US.

Mapletree was receiving balance and transaction updates at various times and in multiple formats from its banking providers. The company used various communication methods for initiating payments and lacked a single way to track payments. In addition to impeding cash visibility, it took considerable time and effort to maintain online banking applications with its banks across countries.

The company sought a solution that would be:

Mapletree implemented on-demand multibank connectivity via APIs. Mapletree owns the data:  there are no interfaces to third-party systems. Using FinLync treasury apps, encrypted data goes directly to Standard Chartered for decryption and processing. A single point of access and control from a centralised location streamlines the company’s payments process. The company has improved cash visibility for better decision making and has decreased trapped cash. Employees have gained productivity by removing complexity from daily banking operations.