Digital Currencies | Not Ready for Corporate Treasury

15-06-2021 | treasuryXL | Kyriba |

Bitcoin and several cryptocurrencies dropped more than $1 trillion in market value, forcing influencers and investors to walk back their advice on using private digital currencies as a reliable store of value. Kyriba’s Wolfgang Koester discussed what was driving this cryptocurrency volatility with Maria Bartiromo’s “Mornings with Maria” on Fox Business Network on May 24th. “We’re seeing increased rhetoric from the Chinese around a Central Bank Digital Currency and the United States are developing their own digital currency,” said Koester.

Big price swings for Bitcoin, Ethereum, and most recently Dogecoin are nothing new. CFOs and Treasurers have always had little appetite for cryptocurrencies, which is why examples like Tesla investing over $1 Billion USD in Bitcoin made such waves in finance circles. And while Tesla reported a quarterly net income boost of over $100 Million USD on their Bitcoin holdings, their social media savvy CEO has since suggested they will move on from their investment. This reinforces for many why cryptocurrencies are a blip on the radar screen and a bad idea for corporations to be involved with. But…are cryptos really that bad for corporates?

First, it’s more a matter of being “not ready” than bad. Cryptocurrencies such as Bitcoin behave like commodities due to their limited supply; the price volatility is fully explained by the supply/demand imbalance. For example, there is a hard cap of 21 Million Bitcoins and these days there is a lot of demand for Bitcoin! Demand for Bitcoin and other cryptos is driven by everything from social media to a fear of missing out (FOMO) that we are similarly seeing play out in other markets, such as residential real estate or in many tech stocks. Corporates, on the other hand, shy away from volatile assets as they require liquidity for their investments and cryptocurrencies just aren’t there yet. Selling several hundred million (or more) dollars worth of bitcoin or ethereum is a market moving transaction and is difficult to manage through the digital wallets and exchanges that are generally more designed for individuals. So, between the liquidity barriers and the unstable values, corporates still can’t rely on privately issued altcoins like Bitcoin, Ethereum, Litecoin and others until these challenges are overcome.

State-sponsored digital currencies potentially have something to offer, however. As Kyriba’s Wolfgang Koester discussed on Fox Business Network’s “Mornings with Maria”, China has made significant advancements in the rollout of the digital yuan, which has further prompted other nation states to accelerate their own digital currency programs. In theory, government-backed digital currencies are expected to offer a striking advantage over the privately issued cryptocurrencies – and that is utility. To have utility, the digital currency must be widely accessible – and be fast and secure. And this is where the Bitcoins of the world are not ready for mainstream use. They aren’t widely accessible, the blockchain “networks” supporting them remain unproven for high transaction volumes, and the value is uncertain and could easily change between the time a seller accepts a cryptocurrency and when they choose to use or exchange them.

Of course there are solutions to each of these individual problems – e.g. the use of stable coins (that are pegged to the price of a fiat currency) instead of altcoins. But each of the requirements – value, liquidity, utility, transactability – must all be met before corporates can expect to safely use crypto/digital currencies on a daily basis. This doesn’t preclude organizations wading into the cryptocurrency landscape as a means of reaching new markets or differentiating against competitors. In fact, more and more online retailers and marketplaces are accepting cryptocurrencies for payment. You can even buy a Tesla with bitcoins. Yet when it comes to corporate treasury and finance teams, they are converting holdings to fiat currencies as quickly as possible so they can still meet cash forecast projections and free cash flow targets. State-sponsored digital currencies may well offer a lifeline to transform digital currencies for mainstream use – or maybe privately issued cryptocurrencies will still rise to the opportunity – and when that day comes it will be fascinating for daily cash management nevermind cross-border payments, global cash pooling, and multilateral netting. I think all of us in treasury look forward to that!

Press release | New Cashforce office in Warsaw, Poland fuels its cash forecasting product excellence

08-06-2021 | treasuryXL | Cashforce |

Cashforce, an innovative Cash Forecasting and Working Capital Analytics solution provider, has announced it will open a new office in Warsaw, Poland to expand the company’s activities. This new office will further accelerate Cashforce’s growth and market presence on a global scale with the addition of a new technical team. For this expansion, various product-focused positions are becoming available, ranging from Chief Architect and team leaders to analysts and front-end/back-end engineers.

“We are delighted to share the news of the opening of our product-focused branch. Together with our new platform which launches soon, we continue to push the frontier of Cash Forecasting & Working Capital product excellence,” said Nicolas Christiaen, CEO of Cashforce.

Cash forecasting remains a top priority of any corporate and Cashforce offers a unique solution to assist finance and treasury departments in this challenge. Building upon years of experience, we’re reinforcing the vision to save time and cash by offering automated Cash Forecasting technology. Our new platform is equipped with real-time data processing capabilities, an intuitive user-experience that lowers the barrier to entry and enhanced (AI-powered) scenario building capabilities.

Jan Bakker, COO of Cashforce, adds: “It’s great to see our global presence ramping up. By reinforcing the product team with various technical positions, we’re ready to further integrate the latest and greatest technologies into our product.”

As a Fintech scale-up disrupting the treasury space, we are experiencing substantial international growth. To make our ambitious vision a reality, we are looking for motivated candidates to join us in creating a world-class product. Of course, it all starts with the amazing people. You can become a part of a dynamic and global team that encourages ownership, diversity and personal growth. Learn more about our company culture here.

WANT TO BE A PART OF OUR FINTECH EXPERIENCE? FIND OUT MORE ON OUR OPEN POSITIONS HERE.

___

Cashforce is a ‘next-generation’ Cash Forecasting & Working Capital Analytics solution, focused on automation and integration. Our cloud-based software enables corporates to unlock their data and create smarter decisions, saving time and money. By integrating internal & external company data (ERPs, TMS, data lakes etc) and processing them through machine learning techniques, our SaaS solution provides insight into Cash Flows & Working Capital, automates manual and cumbersome Treasury tasks and enables AI-powered-scenarios. Cashforce is used by midsize and large corporates and has users in over 120 countries.

When Cash is key, Cash Forecasting and Working Capital leads your company towards a crystal-clear future. When Cash is key … Cashforce.

 

Press contact
Benjamin Bergers
[email protected]
+32 (0) 479 66 27 21

 

Texpo Webinar | Dark Data- Search, Collate, Conquer – Making Sense of Unstructured Cash Forecasting Data

| 08-06-2021 | treasuryXL | Cashforce

Our Partner Cashforce is holding a webinar hosted by Texpo, in which the topic ‘Dark Data: Search, Collate, Conquer – Making Sense of Unstructured Cash Forecasting Data’  is presented together with  David Jacoboski, CTP (Drew Marine).  Dark data is defined as unused or hidden data from relevant departmants in your business, which might have intrinsic value. Watch the full webinar below ??

 

Payment Fraud | A 750 000 euro Financial Scam that could happen even to you

| 02-06-2021 | treasuryXL | Nomentia |

Have you read the recent news on how Bol.com deposited almost 750 000 euros into a fraudulent bank account over a year ago? Simply, they thought they were making a payment to Brabantia, a household goods manufacturer. If you are not familiar with the story, here is it in a nutshell:

At the same time, Brabantia did not receive the payment, so obviously, they took a lawsuit to the court. And that was the point when the court discovered that Bol fell for a financial scam.

It all started with a legit-looking email like usually

In November 2019, Bol received an email in poorly written Dutch. Nevertheless, the email looked legit like it has been sent from Brabantia including the company’s logo. They were asking Bol.com to transfer the outstanding payment to an account in Spain.

The Bol employees fell for the trick. No surprises there, as these emails can be very well-crafted and if you have never seen one before, you could become a victim too.

The court thought the scam email was obvious and easy to recognize 

Bol tried to get out of paying Brabantia claiming that the company’s employee fell for a business email compromise, and they were accused that they did not use two-factor authentication in the Microsoft 0365 environment. The story doesn’t tell if the email was really sent from Barbantia using a stolen username and password but hopefully, it still makes you want to protect your accounts with multi-factor authentication (MFA).

Despite this, the court ruled in the favor of Brabantia and ordered Bol to pay the outstanding payment. The reasons for it were the following:

  •  The court believed the email was clearly a phishing email due to grammar errors. Previously, all communication between the two companies happened in Dutch, while the scam email was written in mixed Dutch and English.
  • The court thought that Bol should have been suspicious about the odd request to transfer money to a Spanish bank.

How to avoid something like this happening to you? 

There are a few tips that you should always remember.

  1. Always be suspicious: Always be suspicious, especially, when you are handling large payments. If you have the slightest doubt about the legitimacy of the request, something is probably wrong.
  2. Never accept a payment alone: In this case, always ask for help! Never send out payment before at least you had a second pair of eyes looking at it. In most companies, that’s an everyday process.
  3. If you are in doubt, ask for help: Still, if there is even one person that is a tiny bit unsure, don’t process the payment. Ask for more help within your treasury or financial department, procurement, or even from your cybersecurity department. Your cybersecurity team will be able to tell with high likelihood whether the email is real or not.
  4. Use a payment hub: Payment hubs come with features that enhance the security of processing payments. Consider using the following: Workflows to manage authorization of different payment flows | Approval limits for different payment types | Templates to limit and control releasing of manual payments
  5. Strict processes to update supplier master data: Supplier master data should be correct in the ERP system. It should only be managed by procurement who has strict processes in place to validate the possible changes before updating master data. Always execute payments according to registered beneficiary bank account details.
  6. Don’t skip the CyberSecurity and phishing training: While you may think it’s easy to spot phishing emails, it’s not. Especially when we are talking about financial scams. Spear phishing is a growing business and it’s expected to grow to 1,4 billion US dollars by 2022. Scammers can work even two weeks on crafting an exceptional financial scam to lure in financial professionals to make a large payment. Good phishing training should be targeted for your expertise and prepare you through challenging exercises to spot potential scams. It’s always better to report an email to your security team and ask for their opinion than make a payment and regret it later.
  7. Care about security: Security is a bigger part of treasury operations than you would think. Make sure that you care about security. Things like using a strong password, updating the password frequently, using multi-factor authentication, or not sharing user rights matter and can do a lot.

When you care about security, you also show a good example to the rest of the team.

Trust your instinct and the learnings of this story and the security training

Always rather take longer to process the payment than pay a scammer! Creating good and strict payment processes and workflows can help with this. Also, trust your own and co-workers’ instinct if you feel like something is off.

Stay curious about financial scam news to know what the latest trends are and how hackers will try to trick you. Work closely with your security department! It’s in everyone’s best interest to avoid falling victim to a scam.

It’s not a question of whether you will receive financial scams and phishing emails, but when you will get them. Be prepared that you will be targeted and face the situation with confidence to avoid making a payment.

About Nomentia

Nomentia is a Nordic powerhouse for global cash management. We believe in a world in which businesses can make the right decisions no matter how unpredictable the times are. Our SaaS-based platform offers solutions for cash forecasting and visibility, global payments with bank connectivity, reconciliation, in-house banking, guarantees, and FX dealing. We serve 2,300+ clients in over 100 countries processing more than 200 billion euros annually. Cash is king!

 

 

Barbara Babati

Barbara is working in the marketing department at Nomentia. Previously, she worked in cybersecurity and data integration industries.

 

 

 

 

 

Why CFOs Should Foster Stronger Relationships with Banks

01-06-2021 | treasuryXL | Kyriba |

CFOs are the custodians of financial growth for enterprise business, and a key part of that role is to build and foster mutually beneficial relationships with banks and funding partners. Since banking relationships are built upon the provision of services; whether those are lines of credit, daylight overdrafts, bank account reporting, payments, foreign exchange or concentration / pooling structures, CFOs can and should maximise the value derived from partner financial institutions.

One of the first mistakes a CFO or finance professional can make is in selecting or expanding a relationship with a bank ill-equipped to handle the global nature of their business and geographic footprint.

For example, banking relationships have implications across borders as many strong financial institutions are partnered with local banks or their own local branches providing much needed local expertise. Navigating difficult tax and reporting requirements, local format and regulatory requirements or unique depository scenarios all call upon strong relationships with banks familiar with your localisation needs.

Automating your banking interactions and reporting with technology is an area of concern.

In this scenario, CFOs are not able to take advantage of the full range of banking services since lapses and gaps in technology solutions do not provide for straight-through processing of payments or the automatic posting of cash and transactional details from bank-provided daily bank statements. Banks have evolved their services to provide much more flexibility and sophistication with regards to intraday bank statements, high levels of detail within bank statements and the frequency of sharing this information up to 4 to 5 times per day. Without the right technology solution to handle cash and liquidity forecasting, CFOs are leaving value on the “proverbial table” in the form of lost opportunities to invest, grow the business, or mitigate risk. Meanwhile, the lack of finance and treasury tools and automation associated with technology solutions, keeps staff tied to daily, tactical tasks versus a focus on strategic support and projects.

How well do CFOs understand the full potential of their banking relationships?

CFOs must be involved in understanding the health of the banking relationship and managing, or at least receiving updates on banking scorecards and other metrics to ensure the bank relationship is being leveraged to its full potential. For instance, more than ever, banks often provide or are partners in enabling Supply Chain Financing or Discounting scenarios to help both sides of the financial supply chain achieve their objectives. CFOs, again, must leverage their banking relationships while coupling them to technology options such as a solution with Dynamic Discounting or Supply Chain Finance to maximise bank services.

Additionally, visibility to liquidity in near or real-time is a must-have for CFOs.

Liquidity planning is critical for CFOs in good times and in bad. Historical market drops have highlighted the importance of having real-time access to information about your total liquidity position, understanding what level of cash is flowing through all systems, and what level of liquidity can be allocated to invest in growth opportunities or simply pay employees. CFOs in many cases can partner with banks to develop a mutually beneficial relationship. At the end of the day, Treasurers provide the CFO with the assurance that assets are safeguarded and the organisation has the liquidity required to meet obligations and fund strategic decisions. This is only possible if they too have immediate visibility into their positions.

Finally, there is risk in having all of your eggs in one basket.

CFOs should have a backup plan – having your liquidity, services and debt instruments with one bank can prove to be risky. When financial crises strike from internal or external factors (like margin calls, bankruptcies, etc.), these financial risks are mitigated when the CFO has a back-stop and other banking partner options to keep the lights on and the supply chain flowing. Having major and minor banking relationships can help keep banks competitively working for you while giving your organization financial and liquidity options to keep operations moving.

Should corporate treasurers stop ignoring bitcoins and other crypto currencies?

26-5-2021 | treasuryXL | Pieter de Kiewit

This is a blog by someone who does not own bitcoins or other crypto currencies and does not intend to purchase any soon. Someone who is not a subject matter expert. Someone who told his colleagues not to consider the topic relevant for corporate treasury for a long time. Someone who thought bitcoins are only relevant for extortionists or those who speculate, gamble and hope to get rich quickly. You understand, that someone would be me.

Slowly I am getting this “One wrong-way driver? I see dozens!”-feeling. Newspapers are filling up with blockchain news. Pension funds start seeing crypto currencies as a relevant asset class. Auction houses start accepting payments (Tesla stopped again) and in countries with hyperinflation in South America, people are fleeing into cryptocurrencies, especially stable coins. After a first attempt with the Libra, Facebook is introducing a stable coin with the so-called Diem that seems to be connected to the US dollar.

My main objection always was that I did not see the underlying value. Real estate is bricks, shares are a piece of ownership, bonds should be paid back and with fiat currencies you can buy in a store. I cannot live in bitcoins and my baker does not accept them as payment. But with gold I cannot buy bread either. It has some practical use as a metal but that does not justify its current value. So why measure bitcoins in practical use and underlying value?

The core discussion is about speculation and trust. There used to be times we knew a dollar or gulden could be exchanged for gold, so we trusted our money. But the gold standard is not so standard anymore. Of course the prices of dogecoins, ethereum and bitcoins are extremely volatile but how about the rates of Argentine Pesos, Venezuelan Bolivars, Turkish Liras or pre WOII German Deutschmarks? When you cannot stand the heat, stay out of the crypto currency kitchen but I do not consider volatility a reason to disqualify the asset class.

As to myself, perhaps I just have to accept that I am a laggard or at best member of the late majority in accepting the technology/solution. As to corporate treasurers, the survey shows they have the ambition to educate themselves better on the topic. Of course to be able to answer questions from their colleagues and perhaps to initiate some form of a practical application of crypto currencies. I hope that, next to the Tesla example, in further blogs we can inform you about relevant business cases. About successful implementation but of course also about the bottlenecks like taxation and reporting. There will be enough happening for many future blogs. And I will be someone who communicates differently about crypto currencies.

PS You might enjoy the slides of a recent presentation by Tristan Verhagen, recent Register Treasurer graduate, a great introduction into Bitcoins with provoking insights. See link.

Take care, Pieter

 

 

Pieter de Kiewit

Owner at Treasurer Search

 

 

 

International Treasury Management Virtual Week | Celebrating 30 years as the world’s leading treasury event

| 19-05-2021 | Eurofinance | treasuryXL |

International Treasury Management is the annual meeting place for 1000s of the World’s most senior treasurers to learn and share experiences in valuable peer to peer discussions. With a reputation for ground-breaking sessions and world-class speakers, our 30th anniversary event will explore the boundaries of the profession, take a glimpse into the future of business, treasury and working life as well as offer the practical case studies on the treasurer’s top agenda items.

Only one treasury event can deliver the comprehensive mix of big picture global insight and granular treasury knowledge you need to make the right choices for the future.


Back to the future, again

Over the past 30 years since EuroFinance’s inaugural conference on International Cash and Treasury Management, much has changed. Treasurers have firmly become business partners, technology experts, risk managers and opportunity spotters. They often lead fundamental change within the company as markets, business models and technology shifts.

What next? This event will delve into how treasury operations can gear up for the future, having learned the lessons from the past. Where, who, what and how will the corporate be in the coming years and what is treasury’s role?

Keynote sessions will offer big-picture insight alongside themed streams including:

  • Payments revisited
  • Risks and Rewards
  • Digital strategies
  • Practical solutions to day-to-day Treasury challenges
  • The power of partnership

What makes International Treasury Management the must-attend event of the year?

  • networking on a global scale – a significant rise in attendees in 2020 boosted the value networking with banks, providers and potential clients… all in one place
  • strategic insights and best practices – get solutions to the challenges you face from treasury and economic experts during keynotes, practical case studies, fireside chats, analytical panels and more
  • future trends – delve into the latest innovations and new technology driving change in treasury, and their practical applications
  • live Q&A with world-class treasurers – enjoy borderless networking and live Q&As with high-profile speakers directly after each session
  • cost and time-efficiency – tune in form anywhere in the world, at the click of a button with no long distance travel or accommodation costs
  • continued learning – catch up on any missed sessions and re-watch your highlights, on demand for up 2 months after the event
  • unite your international teams – as a free event, it offers an opportunity for your whole treasury team to attend. Perfect for encouraging learning and development at all levels

September 27th – October 1st | Virtual

Register Now for Free!

 

 

Successful Businesses Excel At Cash Management

18-05-2021 | treasuryXL | Nomentia |

Nomentia commissioned Forrester Consulting to evaluate the current state of Cash and Treasury management in large global multinationals, the challenges, and the opportunities to move forward.


Embrace future-fit Cash management

We commissioned Forrester Consulting to create a study to understand how global decision-makers will embed cash management excellence into daily operations, processes, and decision-making in 2021 and beyond.

  • Cash flow management tools | To improve visibility and forecasting, companies are adapting cash management, payment efficiency, and cash flow liquidity tools.
  • Improve cash flow visibility | Cash flow transparency, flexible reporting, and data collection can eliminate the high costs associated with the lack of cash flow visibility.
  • Automate core processes | Automating core day-to-day tasks while guaranteeing payment security brings efficiency into the high complexity of treasury operations.

83% of decision-makers at large multinational enterprises say that low Cash visibility has hidden costs 

Understand the cash flow, payment visibility, and efficiency ->  Decision-makers agree that improving data analytics, increasing cash management and payment efficiency, maximizing cash flow liquidity, and improving cash flow and finance reporting are their top priorities in 2021 and beyond.

67% say it’s challenging or very challenging to collect data on cash flow

Technology can help to enable better cash management. Treasury management solutions with analytics, security, and automation can turn treasury from a cost center to a strategic revenue-creating opportunity.

52% of business leaders are prioritizing adopting SaaS Treasury management solutions

Download Study

Learn how companies are enhancing their cash excellence to strengthen and transform cash management operations.



Overcoming Resistance | Integrating Data in Cash Flow Forecasting

| 17-05-2021 | treasuryXL | Cashforce |

Treasurers at mid-cap Corporates looking to use large-scale data analysis to enhance cash flow forecasting are finding colleagues hesitant.

The advantages of using sophisticated data analysis in cash flow forecasting are clear to a growing number of treasurers intent on improving accuracy and eliminating human error. But implementing and executing a data-driven approach often requires collaboration with teams outside treasury, such as AR and credit collections—and some NeuGroup members are meeting resistance.

  • Solid support from leadership and showing the benefits of data analysis may make the transition smoother and help get members of other teams on board.
  • That key insight emerged from a recent discussion at a meeting of NeuGroup for Mid-Cap Treasurers, sparked by a presentation about data-enhanced cash flow forecasting from Cashforce. Read an earlier article from Neugroup here.
  • “A data mindset requires an analytical filter,” one member said, and if another team does not thrive on data, it takes some effort to get colleagues to buy in.

Overcoming intimidation. “I like to be very data-driven,” one member said. “Sometimes that doesn’t go over well in our company. It can be intimidating to people.”

  • “When you start questioning trends, it doesn’t always make people feel very good,” she continued. “I think there can be a lot of defensiveness.”
  • Another treasurer said that, in his experience, “having access to data and showing it to [staff] kind of scares them. People say they want to change—people don’t want to change.”
  • Though there can be a learning and implementation period, he said he was able to find success by stressing how much time data analysis could save in the long run.

Navigating collaboration. Some members said teams that consistently set low expectations for cash flow are often obstacles to using data that produces different, more accurate forecasts. “There can be sandbagging in the forecast, people can be resistant to being more optimistic,” one member said.

  • Another said that, though she would like to see the company implement a more data-focused model for cash flow, it would be too great a challenge to work with functions that don’t fit under the treasurer and do not share the data mindset.
  • One treasurer said his company is having these issues with its AR team, which does not report to him. “When you compare quarters, [we are] 10-15% over our forecast,” he said. “There’s a disconnect.”

Teamwork, dream work. That member said he was able to work with his company’s AR team to incorporate data and effectively eliminate the issue, though there was initial reluctance.

  • He recommends a single individual in a management role spearhead this kind of change. “If it is more driven by one leader, it is easier to shield criticism and make a right decision.”
  • The member said another source of friction can be FP&A and other finance or business leaders outside of treasury who want to maintain oversight of forecasts.
  • Though there is value in working together to incorporate data for forecasting, he said, “the entire organization needs to be ready to become more objective rather than try to manage divisions.”

 

Global Treasury Americas | Planning the post-pandemic Treasury

| 12-05-2021 | Eurofinance | treasuryXL |

The leading virtual event defining today’s corporate treasury agenda

For the past year, treasurers have sweated the core stuff: securing short-term liquidity and longer-term credit; enhancing risk monitoring and hedging processes; and dealing with the implications of remote working. But in the complex and uncertain transition to a new ‘normal’, finance functions will have to resume the search for growth. Can treasury help identify where growth is most likely to come from and which parts of the business are most threatened by digital disruption? And can they do better – can they help build the business strategies needed to prosper as we emerge into the next phase of the pandemic.

This event will explore the practical steps treasurers can take to make enterprise and treasury digitalization a reality and look at varied case studies of transformation in the treasury. The event will look in-depth at new technologies in action as well as more strategic concepts including the sustainability agenda. We look at how treasury can make a difference. Finally, we look at what it takes to transform treasury wherever you are in your journey in order to increase efficiencies, protect the business and make a difference to the bottom-line.

Global Treasury Americas: Planning the post-pandemic treasury

2 days of actionable insights, plus real world case studies tackling the key issues facing treasurers in the region. Topics include:

  • The Great Bounce-back
  • Practical steps on the path to automated Treasury
  • Why sustainability matters for Treasury
  • Name that threat: What’s next
  • Building a true cash culture
  • Payments evolution – the Treasurer’s view

What makes Global Treasury Americas your must-attend event of the year?

  • Understand the practical steps towards making enterprise and treasury digitalization a reality
  • Gain actionable solutions and best practices from varied real-world case studies
  • Network with an unrivalled audience of 800+ senior treasury professionals across the Americas
  • Benchmark your operations against the regions most forward-thinking treasury teams
  • Explore how to support business growth whilst balancing the traditional role of treasury

June 9-10 | Virtual

Register Now