The four core challenges of the modern global treasurer (and what to do about them)
by Gary Conroy – Chief Product Officer at TransferMate Global Payments
The last few years have been, as the saying goes, ‘interesting times’. We have had a global pandemic, global supply chain failures, surging costs and rising inflation, an uncertain geopolitical environment, the ongoing climate crisis, a series of bank failures, and potentially a recession coming.
The list of tactical challenges any global treasurer faces is long, so for today I’d like to quickly break down the strategic challenges into four distinct categories, leading from a risk mitigation foundation to advanced treasury operations.
1. Manage Risk in Changing External Environment
Market events like the Silicon Valley and Signature Bank collapse, and the difficulties seen by Credit Suisse, have led to significantly increased volatility in the financial markets.
This management of ongoing risk is the core function of any treasurer, but there are good and bad ways to do it. For instance, at TransferMate, we don’t lend against our funds; they are fully segregated and safeguarded. This is a model in opposition to banks like Silicon Valley.
2. Addressing Impactful Internal Risks
The second challenge is ensuring you have the right controls in place from a process and access perspective to monitor risk within your internal environment.
Cyber, for example, is an area where risks can escalate over the coming years. Tactics like phishing scams will get more difficult to prevent with the rise of AI, which will help create highly targeted attacks on employees and businesses. You need to arm your finance team with a B2B payment fraud prevention platform to ensure your company pays the right third party on the right bank account.
3. Foundational Treasury to Optimized Operations
Managing internal and external risks are urgent priorities, but what is the next step beyond that?
Cash optimization is the ‘north star’ here for treasurers to aim for - not so much accounting-type measures, such as the cash flow statement or the profit-and-loss statement - but discipline around how cash is moving through your organization.
TransferMate has the ability, via its e-money licenses, to hold funds in over 30 currencies (with each bank account having addressable BIC and IBANs). Treasurers can use the global accounts to receive, hold and pay locally as if they were domiciled in those countries, and repatriate profits when it suits them.
4. Advanced Treasury
The day when one single ERP was managing everything is over. Nowadays, corporate treasurers can benefit from having a wider range of platforms doing niche jobs because of the advanced technology.
As treasurers, you will have more choices and more vendors.
To achieve advanced treasury operations, leaders need to gain intimate knowledge of these solutions and how they fit together to meet your organizations’ demands. Lean on your partners and extract the knowledge from them – the answers are out there.
TransferMate is the world’s leading provider of B2B payments infrastructure as a service. With 92 payment licenses as the foundation of our global infrastructure, we can solve complex payment challenges for partners and customers in 200+ countries and territories and in 140+ currencies.
For more information, please visit our website, www.transfermate.com, or feel free to contact:
Chief Product Officer
VP Partnership Sales Europe