NEW TECH KEY TO TRANSFORMING BANKING PROCESSES Shutterstock / Pungu x TECHNOLOGY Technology adoption tops list of key challenges amid growing recognition of need to improve corporate banking processes A new report argues that the predominant driver for the digital transformation of finance is the desire for improved efficiency, followed by the need to support business growth and ensure operational resilience and security. However, the widespread use of payment technology in day-to-day life has not fully translated to the finance and corporate banking function, which by its very nature is much more complex than personal finance. The report, from AccessPay and Lloyds Bank, said: Operational efficiencies are welcome at the best of times, but with the costs of business increasing and a tough outlook for business growth, the need to find efficiencies has become critical. The report is based on the responses to a survey carried out at events held in the last quarter of 2022. Some 88% of respondents said driving efficiency was a key driver for digital transformation. Supporting business growth and operational resilience and security were key drivers for 59% of respondents. As the report said: Currently, many companies rely heavily on manual processes to connect their finance and corporate banking operations. Indeed, many Enterprise Resource Planning (ERP) systems do not take the final step of connecting to banking systems, which means that data often has to be manually extracted and reconciled with banking systems. The report said that for larger enterprises, with multiple back-office systems and multiple banks, this approach is not only inefficient, but is fraught with issues. First, it can leave companies open to increased risk of errors, such as duplicate payments; it also raises the potential for fraud, as more people have access to corporate banking systems. Second, there is a heightened people risk. Manual approaches are not readily scalable and if transaction volumes increase, there are not always the staff to handle these, the report said. The report also considered the impact on staff morale and retention to consider: Many individuals in the finance space are highly qualified and demotivated by low-level data entry tasks. Finally, the report argues that there can be poor visibility over the companys current financial position. International impact The report noted the impact of doing business, and therefore making payments, across borders, which can mean working with multiple countries, bringing extra complexity to finance processes. As a result, the top challenge of operating internationally was managing access and control to multiple banking portals. This was followed by the lack of visibility of cash positions, which could hinder the ability to optimise cash holdings in interest-bearing accounts. The low interest rates since the global financial crisis have meant this has been of little importance over the last 14 years, but with rates now rising once more it will become an increasingly important consideration, the report said. The report, The Drive to Digital, can be found at bit.ly/3XdUHNW treasurers.org/thetreasurer ISSUE 1 2023 35 TT ISSUE 1 23 pp35 Banking tech.indd 35 23/02/2023 09:21