Over time, vendors have poured in resources to create products that suit different functions of the Treasury. While some help manage cash easily, others focus on easy data aggregation, bank integration, or forecasting. The four most innovative and promising technologies are mentioned, with what happens under the hood, their advantages and limitations explained.

Cloud

The next consideration for a lot of treasurers is to move its operations to a cloud server. This means all the data is stored in a cloud server away from office locations and is accessed by employees online. While this enables them to access data remotely, from different locations, it also ensures regional treasuries can collaborate at any time. This also allows upgrading or improving any computing done without the need for upgrading the IT infrastructure available.

Advantages –
1. Eliminates a disconnect allows real-time data to flow continuously
2. Data access can also be restricted based on job roles
3. Maintenance is easier and cheaper than in-house Treasury Management Systems
4. Vendors use multiple firewalls and encryption to prevent data theft

Limitations –
1. Internet outage or downtime can affect operations
2. Access from insecure networks can leak credentials and sensitive information
3. Numerous vendors provide limited flexibility and control in the solution
4. Vendors provide little to no support in migrating to a different cloud solution

Use Cases –
1. The seamless flow ensures the data that goes into forecasts are accurate and up-to-date
2. Enables faster forecasting since data gathering is easier
3. Treasuries can sync real-time bank data into the system to improve global cash visibility
4. Information can be accessed anywhere, even outside workplaces
5. Offices with different geographical locations can work together

Application Program Interface

APIs are software interfaces that redefine how applications interact with each other. Consider it as a door that connects one entity to another directly. In Treasury, it can be used to enable a direct link to banks to gather real-time information.

Advantages –
1. Real-time data on payments and transactions is always available
2. Eliminates tedious task of batch-processing
3. Easy to set-up and integrate
4. Instant transactions allow a reduction in interest debts
5. Fraud-detection in payments is faster and easier
6. Adds another layer of data security

Limitations –
1. Failed transactions have a difficult reporting format, making it harder to reconcile
2. Does not eliminate the reliance on manual Treasury processes
3. Setting up and maintaining APIs is costly and time-taking
4. Internet outage affects operations
5. Using a single API-integrated account may hamper operations if servers are unresponsive
6. There may be a limit on transactions-per-second, exceeding which may fail all transaction requests sent in a batch

Use Cases –
1. Real-time data ensures reports are always updated to the last second
2. Instantaneous payments eliminate the cost of holding cash for additional hours
3. Reduction in credit risks by avoiding intraday or overnight cash balances with banks
4. The decrease in time for clearing debt allows availing discounts
5. Reaping benefits from early investments using instant transactions
6. Identifying fraudulent payments with real-time data and mitigating the impacts swiftly

Robotic Process Automation

RPAs are robots that are programmed to run a certain set of tasks with little to no human intervention. This would enable Treasury teams to free up a lot of time previously used in repetitive tasks like data gathering and consolidating, and focus more on higher-value duties like cash forecasting, which remains as the top priorities for Treasuries. RPAs can be easily tweaked to perform different or an updated set of tasks.

Advantages –
1. Eliminates high-volume and high-transactional tasks for employees
2. RPAs can gather, consolidate, and store data for easy reporting
3. Cuts costs and streamlines processes easily
4. Repetitive and time-consuming processes can be integrated with RPA easily
5. Processes are more secure and less error-prone due to reduced human intervention
6. Can be set-up to perform operations round the clock

Limitations –
1. Difficult to identify the right usage and could lead to loss of control over key processes
2. Cannot process complex functions which require human-level intelligence
3. Cannot identify faults in operations such as bugs, and requires human oversight
4. Difficult to integrate security and privacy policies, making it harder to identify threats

Use Cases –
1. Process invoices and payments swiftly without errors
2. Payment information received in different formats can easily be processed
3. Make data available faster with integration with the system for better decision making
4. Automate various back-office operations to focus on higher-value tasks

Artificial Intelligence

Artificial Intelligence utilizes self-learning algorithms to identify patterns and changes in them, and guiding Treasuries on what to do. It can track anomalies in transactions and stop them or find shifting behaviors in operations and suggest better alternatives. With complex computing power and process automation, the scope and utilization capabilities of AI are virtually limitless.

Advantages –
1. Takes over complex processes and aids in shifting to higher-value roles
2. Can mitigate risks by identifying and tracking fraudulent activities
3. Integrate with various systems and collect and process information
4. Learn from past behavior and improve workflow
5. Can analyze and think like a human but within a shorter timeframe
6. Help manage liquidity to optimize usage of cash and prevent avoidable debts
7. Self-learn and improve in unpredictable situations such as pandemics or recessions
8. Auto-report on various functions like cash and risk management

Limitations –
1. Takes time to integrate with individual Treasury functions
2. Identifying patterns requires time as AI looks at historical data to predict what’s coming
3. Lack of reliable and credible data can act as an obstacle for AI

Use Cases –
1. Forecast cash with very high levels of accuracy
2. Help Treasurers in complex decision making by running what-if scenarios
3. Partner with banks to automate payments which are in line with financial policies
4. Predict foreign exchange rates for improved decision making
5. Find better investment portfolios and suggest on financial planning