OpusCapita makes Liquidity Management free for all customers

| 26-3-2020 | treasuryXL | OpusCapita |

OpusCapita makes Liquidity Management in a basic version free for their SaaS customers

OpusCapita, treasuryXL partner and leading cash management solution provider announces today that they have chosen to make their Liquidity Management product free for all customers until the end of the year in order to help treasury and cash management professionals to meet the increased demand on accurate cash forecasts due to the spread of the coronavirus.

“We are living in unprecedented times and we want to help our customers. The demands on treasurers are immense right now and I feel if we can help by making our product for free it’s the right thing to do”, states Jukka Sallinen, Head of Cash Management, OpusCapita.

Liquidity Management will be available in a basic version to allow customers to start using it right away without any implementation or set-up needs.

“We are also looking for ways to enable companies who are not our customers to use this functionality at a heavily discounted price”, states Jukka Sallinen, Head of Cash Management, OpusCapita. 

“I am happy that we can help our customers in these tough times and that we as a company can do our part”, states Patrik Sallner, CEO OpusCapita.

What does Liquidity Management Basic enable you to do?

With the basic package, you will be able to enable your subsidiaries across the globe to manually input (or upload from Excel) their current cash balances and future cash flows (for example AR, AP, taxes etc) in OpusCapita. Once you have this data centralized, the basic package enables you to setup Reports and Dashboards which will automatically consolidate and display all entered balances and cash flows.

In short, this includes:

  • Manually entering cashflows (Liquidity Unit Entry)
  • Manually entering cash positions (Liquidity Balance Entry)
  • Liquidity grid and graph, best-practice Reports such as:
    • Cash Visibility
      • Cash balances per bank account, per bank or per company
      • Actual inflows and outflows on bank accounts (if statements are imported in OpusCapita)
    • Cash Forecasting
      • Total forecast
      • Forecast per bank account, per company or per currency
      • Actual vs Forecast
    • Dashboards for visualizations cash positions and forecast

Three steps to get started

1. Get in touch with us so we can enable Liquidity Basic for you.

2. Add cash flows with pre-built templates or import them from Excel.

3. Build reports with our straight-forward drag’n’ drop functionality.


Read more information here.


About OpusCapita

OpusCapita enables organizations to buy and pay quickly and securely, with a real-time view of their business. OpusCapita customers use their source-to-pay and cash management solutions to connect, transact and grow. OpusCapita processes over 100 million electronic transactions annually on its Business Network.

Visit OpusCapita

Visit Partner Page

Read Customer Success Stories

treasuryXL announces partnership with OpusCapita

| 19-3-2020 | treasuryXL | OpusCapita |

treasuryXL announces partnership with OpusCapita, a leading cash management provider.

VENLO, The Netherlands, MARCH 19, 2020 – treasuryXL, the community platform for everyone who is active in the world of treasury, today announced the premium partnership with a leading cash management provider, OpusCapita.

As a marketplace, treasuryXL will offer OpusCapita market commentary and insight to its audience. Offering a continuous flow of relevant treasury content, making treasury knowledge available, results in treasuryXL being the obvious go-to platform for its’ audience. OpusCapita will have a prominent role in the Treasury Topic environment with coverage in Cash Management, risk management, Treasury Software, Payments & Banking and Fraud & Cybersecurity. Together they will host virtual roundtables in the near future to connect with partners and experts around the world.

“We are excited to take part in the treasury community that TreasuryXL is building and look forward to join the network of treasury experts.” Marc Josefsson, Head of Strategic Sales, OpusCapita.

OpusCapita has over 800 customers across more than 100 countries. Their secure, cloud-based solution enables Treasury and Finance professionals to harmonize global processes and policies, centralize treasury and finance operations and reduce complexity.

treasuryXL and OpusCapita strive for a fruitful partnership where its’ audience are top of mind making sure that (potential) clients are always up to date with the latest cash management news and events benefit from a comprehensive range of services and products.

About treasuryXL

treasuryXL started in 2016 as a community platform for everyone who is active in the world of treasury. Their extensive and highly qualified network consists out of experienced and aspiring treasurers. treasuryXL keeps their network updated with daily news, events and the latest treasury vacancies.

treasuryXL brings the treasury function to a higher level, both for the inner circle: corporate treasurers, bankers & consultants, as well as others that might benefit: CFO’s, business owners, other people from the CFO Team and educators.

treasuryXL offers:

  • professionals the chance to publish their expertise, opinions, success stories, distribute these and stimulate dialogue.
  • a labour market platform by creating an overview of vacancies, events and treasury education.
  • a variety of consultancy services in collaboration with qualified treasurers.
  • a broad network of highly valued partners and experts.

About OpusCapita

OpusCapita enables organizations to buy and pay quickly and securely, with a real-time view of their business. OpusCapita customers use their source-to-pay and cash management solutions to connect, transact and grow. OpusCapita processes over 100 million electronic transactions annually on its Business Network.

Visit OpusCapita

Visit Partner Page

Read Customer Success Stories

Are we entering an unprecedented economic situation?

| 28-02-2020 | treasuryXL | Pieter de Kiewit

One of my favourite professional pastimes as a corporate treasury recruiter is digesting treasury technical content and bridging it to the “rest of the world”. Or see what is happening in the global news and projecting it on the field of corporate treasury.

Currently there is a constant flow of news about too much money in the market. One would say this is a good thing. Let me give you some positive and negative examples of the effects:

But also:

  • Pension funds are not able to invest in a future-proof way;
  • We have to pay for our savings (if you have a lot);
  • Hedge fund managers use external funding, instead of the funding of their investors, to safeguard their bonuses.

We enter an unprecedented economic situation only encountered by Japan and there is no obvious path to take. I will not try to clarify macro economics, it is not my field of expertise, but do know that changing demographics contribute. Us getting older and people retiring rich, most likely richer than their kids, has to do with this. What do I see as effects on corporate treasury? Let’s focus on three main tasks of a corporate treasurer.

In cash & liquidity management there are many exciting initiatives in the improvement of cash flow forecasting. Payments can technically be done smoother, safer and quicker. Cash visibility can be increased and liquidity is centralized. Most corporate treasurers want to implement these new solutions. As liquidity is high, many CFOs do not feel the urgency to invest in these initiatives. Doing nothing will not result in higher cost, so what is the ROI?

In risk & investment management the obvious focus is on interest developments. The general opinion is that interest will be low for a very long time. Getting long term funding for (almost) 0% is doable. So why bother matching long and short term funding options? This results in a situation that the use of hedging instruments is less important. Investing excess cash or helping the company pension fund with their strategy currently requires analysis and choices.

Corporate Finance has the fun task of optimizing the balance sheet and lowering funding costs to an extreme. I recently met the group treasurer of a real estate company who is able to make money attract funding for his company! The more challenging task of corporate finance is participation in business development and M&A. The willingness of entrepreneurs, shareholders and boards to invest in adventurous ways is high. The corporate treasurer has to hold on to his role of risk manager and hit the brake. This does often not increase his popularity…

A lot more can be said about the topic, that will be for other blogs. Back to a non-corporate mindset and not pretending to be a socialist, I hope all this money will be used to improve the world: better the environment, lowering the income gaps, makes us all happier. The real philosophical approach I leave to Notorious B.I.G.

Enjoy your money,



Pieter de Kiewit

Owner at Treasurer Search

Top 5 most common pain points in Treasury

14-02-2020 | treasuryXL | Michael Ringeling

The purpose of Treasury is to manage a company’s funding, liquidity and to mitigate its financial and other risk. Made up of three sub-disciplines, Treasury’s overall objective is to safeguard the company’s holdings and to follow the long-term strategy set forth by Corporate Finance (and strategy). Cash Management, on the other hand, is primarily focused on operational, short-term, efficiency and process optimisation, whereas Risk Management is oriented towards financial research and operational controls.

Michael Ringeling, corporate treasury expert,  made a top 5 of the most common pain points he encounters in Treasury, including consequences and a solution.

Top 5 of the most common pain points in Treasury


  1. Too many bank accounts at too many banks

Complex to manage, poor control, higher risk of fraud, higher costs, more KYC/AML requirements

Less bank accounts at fewer banks, all via one or two electronic banking systems or multibank platform to manage payments and cash flows. The result will be more efficient, more secure and more cost-effective payment transactions, reporting and reconciliation into the ERP system.

  1. No reliable cash flow forecast

Poor liquidity management. Insecure about the required short and long term funding and poor management information.

A good cash flow forecast, providing adequate insight in the organisation’s short and long term cash flows, will contribute to an efficient funding strategy and lower cost of funds.

  1. FX results, (negatively) impacting the company’s P&L

The company’s financial results are impacted by unforeseen and unknown FX results

FX risk management analyses, create a FX policy and perform deal execution (hedging) to control FX results

  1. New Loan Agreement needed – negotiations

Difficulties in assessing if the loan terms and conditions are fair. Risk of overpriced loans and/or unfavorable terms and conditions required by the bank(s).

Assist the company when negotiating with the bank(s) to get a fair deal with terms and conditions that will not unnecessary limit the company’s flexibility.

  1. Cash is trapped on too many stand alone bankaccounts around the world

Company cannot effectively use a significant amount of cash, resulting in higher (short term) loans and higher interest costs.

Implementation of a cross border cross currency cash pool to centralise the company’s cash balances. As a result the amount of local trapped cash will be reduced and that cash can be used for general corporate purposes. Less short term loans and lower interest costs.

Sounds familiar?

Do you recognize the pain points that we mention above in your business? Or are you experiencing other critical treasury pain points in your business?

In our active network there are several treasury experts who can offer treasury support. They can be hired for specific projects or on a regular basis. Check Rent a Treasurer and let us help you.


Michael Ringeling

Corporate Treasurer Expert

Digitalization enhances the strategic position of the treasurer

| 27-12-2019 | TIStreasuryXL

Treasury departments are currently under pressure from two sides: Firstly, they are confronted with new regulatory changes for payment ecosystems, compliance regulations and provisions on combating money laundering and terrorist financing, which they must tackle by means of processes, technology and personnel. At the same time, digitalization is changing the business model of their companies. New technologies are coming to the fore, which redefine the payment area. The traditional, role, structure and staffing of the treasurer are thus being redefined. However, the opportunities of digitalization do not by any means poses a threat. Using them skillfully enables the treasurer to play a greater strategic role in future.

Cash and liquidity management, monitoring of accounts receivable and accounts payable accounting, budget and finance planning and financial risk management are the traditional core functions of the treasury as transaction and reporting center in the company. This is not going to change in the future either. What is new is that data material will be better exploited in the future by enhanced technologies. Among these technologies are: automation, artificial intelligence, big data analytics, machine learning, robotic process automation, open application programming interfaces (APIs) and cloud services. The “next generation treasurer” combines them to create a digital tool kit so he or she can become a more strategic bearer of risk and competence center for analytics in the company.


Digitalization is a horizontal phenomenon. It affects traditional industries, their definition and boundaries. Companies are no longer attacked in the core of their industry, but at the perimeter. Those who do not pay attention, but restrict their strategy to their own industry, will be among the losers. However, those who engage in winning horizontal thinking – platform strategies, user-centric thinking, etc. – are much more immune from unpleasant surprises. Because these thought patterns are very similar across industries. We can shape our own future by borrowing from other industries. This can be transferred to the company level: The treasurer can also connect to new predictive maintenance technologies.

Changes in the treasury due to digitalization are already apparent and even acknowledged by the industry: In the middle of 2018, the British Economist Intelligence Unit conducted a study among European Senior Corporate Treasurers on behalf of Deutsche Bank. More than half of those questioned stated that their company had already changed its business model on the basis of disruptive technologies and this had a (negative) impact on their area of activity. Thus, significant innovations can be found in the areas of multi-channel payments, mobile solutions and product lifecycle of supply chains.


The fact that a negative impact is perceived or even feared is reflected in the ingrained “gut instinct” of the treasurer as custodian of the company finances. The analysts of the Economist Intelligence Unit discovered that many were still not ready for the enhancement of their traditional role. The industry must break free from this role as a response to digitalization. It needs a stronger entrepreneurial perspective which seizes new opportunities instead of lying in wait for threats. Because digital technologies give you the opportunity to carry out formerly manually performed processes faster and more efficiently by means of automation. This creates room for new themes and strategic participation.

It is not just a question of using new technologies within existing systems. Too often the focus remains fixed on more efficiency, automation and incremental advancement of existing technology. Covering up old business processes and putting “digital icing on the cake” lead to the past. Those who think like that have not understood the fundamental ideas of digital transformation, which read: Innovative technologies first open the door for completely new business models and processes which would have been utterly inconceivable without them. What is required is not just a digital strategy, but a business or company strategy in which digital technologies become an integral part of the value chain architecture. Digitalization as a means to an end for future business goals!


“Software is eating the world”, it used to be said. Today, data is the new gold Liquidity data, payment flows and cash flows in real time contain essential information, which can only be properly evaluated by the available technology today. Thus, they become the treasurer’s “gold nugget”. Cloud-based payment platforms such as TIS are the basis for making data available in real time to central office. The treasurer can evaluate it with AI software, can train neural networks with his or her payment patterns and receive solvency forecasts of individual clients, who are just as relevant for Purchasing as for Sales, the CFO or Executive Board. He or she provides his or her business partners with information, which is not just recommendations for action at an overall holistic level. But they reach down to the level of individual customers or customer classes.

Meanwhile, banks have a regulatory obligation to open their business processes to the public via open API. They can broaden the scope of cooperation to include Fintechs and integrate process steps faster, which these may master better, into the business process landscape via open interfaces. The open API concept requires openness and readiness to adapt the function to the new mindset. Treasurers must learn to think in accordance with the open API framework.


Those who use the new data analysis opportunities will be a relevant sparring partner for the CFO/CEO. The treasurer is in an ideal starting position, because he or she is at the source: where the cash is. Especially in a volatile, complex business environment, a free cash flow buffer is precisely the currency that a company requires for experiments in the area of digital transformation. The treasurer thus plays a strategic role – less in the sense of long-term planning as before, but rather in such a way that the company can now, with his help, perform agile capital allocation for experiments.


Treasurers need not fear being disrupted if they are ready to think outside the box and jump at new opportunities.

They have the potential to take on a more creative role in the company, to contribute to new business models and to adopt a strategic position. This also requires a new mental model. Does one want to remain a treasurer? Or does one acquire skills in the areas of software engineering, data science and project management or lead a team comprising these disciplines. This should no longer even be a question for the next-generation treasurer.


The treasurer of tomorrow…

  • pro-actively contributes to his or her company reaching competitive advantages in an uncertain business environment.
  • creates the financial conditions for an entrepreneurial, exploratory and agile organizational development.
  • becomes strategic advisor for the CFO and Executive Board during the change to new digital business models.
  • uses digital technologies to meet the demand of the company for real time financial information and to intensify cooperation with suppliers and banks (via open APIs).
  • deals with ethical questions connected with artificial intelligence and new risks (cybercrime)

About the author: TIS

TIS (Treasury Intelligence Solutions GmbH) based in Walldorf has been combining experience and competence in financial planning since 2010, with particular expertise in cloud
computing. The result is the TIS solution: a comprehensive,highly scalable cloud platform for managing company-wide
payments, liquidity, and banking relationships worldwide. TIS enables SMART PAYMENTS to help the customer make better decisions by analyzing financial and operative performance on
the basis of the real time of the payment flows. The TIS solution has been successfully used for years in medium-sized and
large companies, such as Fresenius, DACHSER, BearingPoint, Heidelberger Druckmaschinen, Marquard & Bahls and Swiss Airlines. TIS provides Software-as-a-Service (SaaS) and offers
internationally operating customers key advantages, such as lower costs, risk prevention, a higher degree of transparency, shorter integration times, fast worldwide roll-outs and smooth
updates. The high level of security and deep integration of the platform with existing ERP systems are attested by the ISO-27001, SOC 1 and 2, as well as SAP certifications. Financial
Times and Statista recognize TIS as one of Europe’s Fastest Growing Companies 2019.
Further information can be found at www.tis.biz/en

About the author: Dr. Carsten Linz

Dr. Carsten Linz is a proven expert in entrepreneurial leadership, innovation and business model transformation. As a multiple entrepreneur and New Business Developer he has built up several hundred million EUR-business in the course of his career. He was also responsible for transformation programs for up to 60,000 employees. For SAP, he leads the Center for Digital Leadership, a renowned think tank for next generation digital innovation and transformation approaches. Mr. Linz is active as a business angel and in the investment committee of the largest European seed fund and holds several advisory board seats.

As an extended faculty member, he teaches Executive MBA courses at the Mannheim Business School, the European School of Management & Technology Berlin, the University
of St. Gallen and the Stanford Graduate School. He is the author of several books, among them “Radical Business Model Transformation: How to Gain the Competitive Edge
in a Disruptive World,” which was awarded the Top Business Book 2018 and translated into five languages. His articles have appeared in Forbes, Harvard Business Review / Managers, ZDNet, Computerwoche, Frankfurter Allgemeine Zeitung, D!gitalist Magazine, CIO Magazine.

Dr. Linz was named “Top 100 Digital Influencer”, awarded the “Innovation Landmark” by the German Federal President, awarded the “Award of Excellence” by the Global Institute of Logistics, and named “Leader” in the Gartner Magic Quadrant. He is an advisory member of the Digital Enterprise and Digital Platforms & Ecosystems projects of the World Economic Forum. Dr. Linz is a sought-after keynote speaker (London Speaker Bureau) and advises board members all over the world.

Go to TIS partner page

Recap of the SCF Forum and Awards event 2019

| 23-12-2019 | by treasuryXL |

On the 28th November 2019, treasuryXL attended the SCF forum Europe 2019 in Amsterdam – an annual event. Here is our review of the day.

So, what is Supply Chain Finance (SCF)?

It is a series of processes, both financial and technological, designed to improve business efficiency and reduce financing costs by providing bespoke short-term funding solutions for both buyers and sellers, with a view to improving and enhancing working capital and liquidity for both buyers and suppliers.

There are three parties involved – buyers, suppliers and financial providers. Traditionally, banks acted as the provider of funding but, with the advent of fintech other non-bank firms are also offering solutions.

The ultimate purpose of SCF is to improve the cashflows for both buyers and suppliers.

Participants included banks, fintech, academia, together with companies that use SCF solutions such as DFDS, Airbus and Jumbo supermarkets.

The forum started off outlining the major themes surrounding SCF that needed to be considered:

  • Data collection and analysis
  • Education
  • Financial Flows
  • Procurement
  • Logistics – the missing link
  • Inclusiveness
  • Sustainability

Time was given to highlighting the awareness needed to form a true collaboration with all participants – intra firm, inter firm as well as the supply chain itself. No one department can successfully implement SCF on their own – it requires the input from a wide range of departments.

Rabobank gave a talk about trade and its impact on poverty. Between 1900 and 1950 Europe and the USA moved ahead, economically, from the Far East and Africa. Since the financial crisis of 2008 the middle ground of Europe and the USA has been squeezed and whilst poverty has decreased worldwide, the levels of inequality between income and wealth had risen back to the levels of the 1920’s.

Whilst trade tariffs are on their way down, trade barriers have been rising.

Politically the near future is likely to bring about new confrontations on world trade:

  • USA – China
  • Brexit
  • Capital controls to counter tariffs
  • Restrictions on foreign ownership

DFDS – case study

DFDS are a Danish shipping and logistics company, focusing also on ferries and door-to-door solutions. From an environmental view they have big concerns about the impact of logistics on world climate. Their aim for the future is to be smarter, cheaper and to have less impact on the environment. On the logistics side they must be more cost efficient as they operate in a market with small margins and large competitors.

As data has grown exponentially, they have embarked on an extensive SCF programme that has seen their return on invested capital improve from 5% in 2012 to 19% in 2017.

Major challenges are still to be faced – especially because of Brexit as 45% of their business goes through the UK. Hauliers in the UK are especially worried. This sector of the industry is best suited to younger truck drivers (there is a 73% satisfaction rating amongst drivers between 18-24 year olds), but problems are evident in the lack of female drivers and an average age for drivers of 50 years old and rising all the time.

DFDS strives to help hauliers via SCF by paying early with discounts. This had led to both an improvement in working capital fo DFDS as well as hauliers – one was able to purchase 10 extra trucks by being paid early.

Jumbo – case study

Jumbo is the second largest supermarket chain in the Netherlands with a 21.6% market share. Their growth in turnover has been impressive – from EUR 120m in 1996 to EUR 8.5bn in 2019. There is a strong impetus to manage the needs of both the suppliers and the company. Whilst Jumbo has grown rapidly a lot of their small suppliers had trouble keeping pace especially with the terms and conditions that existed before the implementation of SCF solutions. As and when Jumbo grows, their suppliers need to follow and 80% of their suppliers are defined as SME (Small and Medium Enterprises).

Jumbo has implemented a variety of different solutions to meet the needs of their suppliers, such as reverse factoring, dynamic discounting etc. It was important for Jumbo that the suppliers got on board with the programme – they have more than 1000 small suppliers. There was a 63% pickup in the first few months.

Moodys – word of warning

One of the main instruments used in SCF is reverse factoring, which differs markedly from traditional factoring. Reverse factoring is initiated by the ordering party – the buyer. As they are normally the larger party to an agreement their credit standing is of a higher order than the supplier – hence their interest costs are lower than for the supplier. With reverse factoring suppliers get paid early and buyers can delay payment to the factor (financial counterparty). However, the liability rests with the buyer.

Whilst it is increasing in popularity as a source of financing it can lead to a weakening of liquidity. Rating agencies are grappling with the legal consequences and lack of disclosure of reverse factoring. Now there is no legal requirement to disclose how much reverse factoring is on the books. This can lead to an incorrect picture of the financial health of a company. Companies that embraced Reverse Factoring but eventually suffered as result include Carillion, Abengoa and Distribuidora International de Alimentacion.

Big Data and AI

With the advent of ever more computing power it has become possible to analyse increasing amounts of data. This will lead to big changes in SCF through the use of Artificial Intelligence such as:

  • Traditional SCF
  • Fintech solutions
  • AI powered SCF solutions
  • Blockchain and Internet of Things

However, whilst embracing technology solutions we must not lose sight of old axioms such as “garbage in is garbage out”. It will be necessary to truly understand the flow of data, the variables and the output. Modern history has plenty of examples of large sources of data and experts, leading to losses and mistakes as well as profits and rewards.


  • A truly collaborative arrangement both internally and externally
  • Greater understanding of the business drivers
  • Improved early payment for suppliers
  • Chance to delay payments for buyers
  • Mutual transfer of knowledge and requirements for both parties
  • Improved relationships
  • Need to onboard all relevant departments

The opening quote at the forum was “Bridging physical and financial supply chains”. The one area that I, personally, felt was missing was the impact on the circular economy. Whilst there was talk on sustainability and global climate, I wished to hear more about how to increase the effective use of assets – trucks going to clients full and then returning empty, etc.

Maybe that can be a “hot item” for next year’s forum.






Lionel Pavey

Cash Management and Treasury Specialist


To swap, or not to swap that is the question

30-9-2019 | Marco Lassche |

Cash management in different currencies:
The FX swap, a way to optimize your interest result

Years ago, when I made my first baby steps in the world of Treasury at Bank Mendes Gans, my old teachers Jan Loohuis and Aart-Jan Lensvelt, taught me some good lessons. One of them, that I always used in the companies that I have worked for, is this one.

What if you have temporary an overall negative position in one currency (e.g. -/- EUR 10 mio) and an overall positive position in another currency (e.g. +/+ USD 11 mio)?

Basically you have two easy ways to manage this liquidity position and optimize your interest result. Both ways lead to Rome:

  • Keep the balances in your bank account
  • You swap the balances in different currencies temporary by means of a FX-swap

Option 1: Keep the balances in your bank account
This option does not need much clarification.

  • For your debit balance you pay interest (basic interest +/+ margin)
  • For your credit balance you receive credit interest (basic interest -/- margin

Option 2: The FX swap
In a FX swap you do a trade in your FX trade portal, in which you exchange the bank balances at a spot date (at the spot rate) and you reverse it at a future date (at the forward-rate). You do the trade at the same time, so no FX risk is involved.

Forward FX-rates are being calculated directly from the spot FX-rate and are adjusted for the difference in interest rates between the two currencies.

FX swap visualised

Option 1 or option 2?
When the interest rate difference between the two currencies is more attractive in option 1, you keep your bank balances. When the interest rate difference between two currencies is more attractive in option 2, you swap.

I would like to clarify it by an example in which we have a EUR balance of -/- EUR 10 mio and a
USD balance of +/+ USD 11 mio. We will swap the currencies for 1 month (30 days).

Interest results after 30 days

Option 1) Interest result by keeping balances in your bank account

Total interest proceeds in USD: EUR 2,708 * 1.1000 = USD 2,979 + USD 18,563 = USD 21,542.
Interest rate difference between USD and EUR: 2,35% (2.025% -/- 0.325%).

Option 2) Interest result by swapping balances

Interest result FX swap

At the start date we buy EUR 10 mio, and sell USD 11 mio at the spot rate 1.1000.
At the end date, after 30 days, we reverse the trade as we agreed with the bank:
We sell EUR 10 mio, and buy USD 11,025,770 at the agreed forward rate 1.102577

Our total interest rate difference proceeds is USD 11,025,770 – USD 11,000,000 = USD 25,770.

In this example the FX swap is USD4,200 more attractive than keeping the account balances like it is. Of course, this is not always the case, but a FX swap can be a good alternative in many cases.

* How to calculate the interest rate difference between two currencies in a FX swap
As previously said, the difference in spot and forward rates, can be explained by the interest rate difference between two currencies, We calculate the interest rate differences as follows:

Forward Rate on annual basis / Spot Rate

As interest percentages are always based on 1 year we multiply the 30 days forward points by 12 to get to 1 year forward points (EUR and USD, calculate 360 days in a year, GBP e.g. 365 days).
The forward points for 30 days: 25.77, which means for one year 12 * 25.77 = 309.24
Forward rate on annual basis: 1.130924

Spot rate: 1.1000

1.130924/1.1000 = + 2,81%

Please feel free to contact me if you need any further information.





Marco Lassche 

Founder and Owner of at Bedrijfskostenexpert

The Role of Netting in Cash Management

|13-8-2019 | treasuryXL | BELLIN

Increased cash flow efficiency, faster cash allocation and optimized FX management

Cash management is every company’s bread and butter. Considerably fewer companies make use of netting, despite its many advantages for cash management.




Netting supports companies in making their cash management more efficient and less costly by

  • Boosting cash flow efficiency,
  • Consolidating invoices and enabling faster cash allocation,
  • Allowing companies to better calculate their FX exposure and hedge it strategically.

Cash management

Through cash management, companies ensure they can always meet their financial obligations. It allows them to allocate the required liquidity to the right entity, at the right time, in the right currency. For treasury to achieve that, all incoming and outgoing payments as well as account balances and forecasts must be visible. With access to complete and up-to-date information, treasury can monitor processes, plan liquidity based on forecasts and strategically manage cash in different currencies.


Companies that have implemented netting offset cash flow obligations between two parties and consolidate them to a net payment. Most companies use netting for balancing intercompany trade flows. However, it is also possible to integrate other parties as netting participants. Using internally-agreed conversion rates, companies can engage in cross-currency netting.

More information on netting: Netting: An Immersive Guide to Global Reconciliation

Videos on Reconciliation and Netting and Cash Management

The impact of netting on cash management

Netting takes a specific proportion of all cash flows and places them within the framework of a dedicated and structured process. This process, the netting run, is repeated at regular intervals. It can be divided into four steps:

  1. Data import
    Data is imported from the ERP system to the netting system.
  2. Data reconciliation
    The netting system automatically matches and consolidates submitted payables and receivables based on pre-defined parameters and creates a netting statement.
  3. Data sharing
    Once data has been matched and invoices consolidated, the netting center communicates the net amount to every netting run participant. It can be issued in their currency of choice.
  4. End of cycle
    The netting center makes one single payment to participants with a positive balance. Participants with a negative balance make one net payment to the netting center.

netting run

Netting boosts cash flow efficiency

By offsetting payables and receivables, netting reduces the number of transactions. In turn, this reduces cash-in-transit. And reduced cash-in-transit and minimal transactions make for reduced efforts when it comes to procuring liquidity, interest burden and payment processing.

In addition, the schedule of the netting run means payments are made on a specific date: instead of having to monitor countless different dates, treasury can lean back and wait for the end of the netting cycle.

Netting makes the lives of cash managers much more linear: they can plan accurately and allocate the exact amounts of required funds to accounts. This means that the company can keep floating assets to a minimum. Netting lends structure to complex processes and ensures opitmal allocation of cash flows.

Netting accelerates cash consolidation and allocation

All transactions between two parties result in accounts receivable for one company and accounts payable for the counterparty. The respective journal entry must show a zero balance. However, without a structured process in place, consolidation efforts are often far from straightforward. The different parties pursue different interests – either receivable- or payable-driven.

A good netting process seeks agreement between the parties and allows them to clarify any disagreements within a structured and automated framework. Agreement-driven netting encourages participants to submit accurate data. This makes for a much faster reconciliation process and makes it possible to automate several steps of the netting cycle. A speedy reconciliation process is followed by swift payment processing –  directly in the system and with one click – and makes for greater efficiency.

Faster consolidation has a positive impact on cash flows. At the same time, netting saves treasurers valuable time when it comes to monitoring invoices. Conversely, accountants no longer need to waste hours matching invoices. On average, time savings amount to 1-2 man-days per month per entity. For a group consisting of 10 entities, this equals 10 to 20 days per month and 240 days per year – a full-time position that can be dedicated to other tasks that add real value to the company.


Netting saves time

Netting optimizes FX management

Netting makes it easier for companies to manage their FX exposure, i.e. to optimize their FX management.

The payment terms defined as part of the netting cycle govern the timeframe between issuing an invoice and paying it. Companies that use cross-currency netting also set internal conversion rates for the currencies in question that apply to the respective netting cycle.

Having defined dates and rates, treasurers gain insight into an entity’s hedging requirements for a specific time period and can consolidate this sum to one hedging transaction. The netting center also defines the settlement price that is used to convert each entity’s FX payments to the respective settlement currency. This creates implicit hedging. The netting center can post and settle the transactions for each netting run participant without impacting the FX result. Entities transfer their actual currency exposure to the netting center, where it can be hedged strategically.

How netting optimizes FX management – an example:

As part of a monthly netting cycle, a company defines a payment term of 30 days. An entity issues and posts an invoice in March, which is paid in April. In February, the netting center defines the FX rate for March, and the March rate is identical with the settlement price for April. The netting center has complete visibility of currency requirements and can hedge the FX exposure centrally. Transaction and conversion costs are reduced to a minimum.

Netting FX-Management


Netting and cash management in a nutshell:

Netting is a powerful tool for companies to optimize their cash management. Netting lends structure to offsetting cash flows and puts them into a clearly defined timeframe, the netting cycle. This has the following benefits:

  • Very precise account planning
  • More efficient cash flows
  • Faster consolidation
  • Option to automate processes
  • Speeding up of the cash allocation process
  • Visibility of FX requirements
  • Strategic FX hedging

Interested in finding out more about whether netting is the right solution for you? Give BELLIN a shout or check out tm5, our intuitive treasury management system.



The principles of multilateral netting: what, why and how

| 27-06-2019 | ENIGMA Consulting |



This article is meant as an introduction to the process of multilateral netting for international companies. It describes the fundamental concept of netting, the steps within the netting process and the ultimate benefits of netting. In addition, we elaborate upon the role of technology in netting and prepared a checklist for anyone that considers using netting in their company.

1. What is (multilateral) netting?

Netting is the process of consolidating payables against receivables between parties. Rather than settling each individual invoice leading to a large volumes of transactions, parties can consolidate invoices and agree upon one net payment stream. In the majority of the cases, netting is set up between internal group entities as parties for settling their intercompany invoices, but external (third) parties could participate in a netting process as well.

Most of the netting methodologies are either payables- or receivables-driven. In a payables-driven system, payables are netted against the payables of the other participants and in a receivables-driven system, receivables are used. Note that in the end it is (or should be) a zero sum game: intercompany receivables = intercompany payables.

If there are only two parties involved in the netting process it is called bilateral netting. If there are more than two parties involved that use a central entity to interact for all their intercompany transactions then the process is called multilateral netting. The figures below illustrate the differences between the payment flows before and after implementing a multilateral netting solution using a central entity (netting center).

Intercompany process without multilateral netting          Intercompany process with multilateral netting

2. How does the multilateral netting process works?

In general, the netting process (netting cycle) involves the steps outlined below:

Step 1: Collect invoice details from local entities
The first step is to have the local subsidiaries send their invoices to the netting center. Usually there is a central database where all the received invoices are collected. See also chapter 4 on technology.

Step 2: Verify / dispute invoices in the netting cycle
When invoices between two parties do not (automatically) match they should be investigated and disputes should be managed.

Step 3: Communicate netting balances to local entities
Once all invoices are reconciled, the netting center will calculate and send a netting statement to each of the local entities containing the balance that they will receive or need to pay.

Step 4: Settlement via cash or intercompany booking
The netting center distributes payments to the local entities that have positive balances. Local entities with negative balances will have to make a payment to the netting center. After the netting cycle is closed, a new round of collecting invoices will start (step 1).

3. Why use multilateral netting?

There are numerous advantages to those corporates that deploy multilateral netting:

  1. Reducing bank and transaction costs as a result of less funding transactions, less FX accounts and trades and savings on FX spreads, volumes and commissions. The pricing of FX deals can improve as the total number of FX transactions is consolidated into larger trades.
  2. Centralizing FX management as the netting center has the complete overview of currency requirements and is better able to hedge FX exposure.
  3. Standardizing the intercompany settlement process, creating both a single transparent approach throughout the company and discipline with regard to intercompany procedures and dispute management. This, in turn, can also minimize operational risks while maximize the operational efficiency.
  4. Improving the posting of intercompany invoices and reconciliation. By automizing this process (see chapter 4 on technology) not only treasury but also the accounting department benefits from netting.

For those international companies treating multilateral netting as part of their treasury roadmap it is possible to further enhance the benefits of netting by linking it with cash management. Integrating the use of a netting center with an in-house bank (IHB) can eliminate the use of physical cash payments by settling the net balances via the IHB.

So, for which companies it is worthwhile to consider multilateral netting? Corporates that have various (decentralized) local entities and various currencies and that have continuous multiple intercompany transactions between the local entities.

4. How can technology help

Technology and systems are key for an efficient and automated netting process. Examples of this are the following:

  1. Data collection
    The netting center relies on external input from its participants in order to reconcile invoices and calculate final settlements. The A/P and A/R invoices should therefore be collected from the ERP system and be sent to the netting center each netting period. Automation of the data collection will help the consistency and reliability of the data input for the netting process
  2. Netting calculation
    For the netting calculation, systems are crucial as the calculation for multiple invoices from multiple parties, in multiple FX can be quite complex.
  3. Dispute management
    Where invoices are sent, disputes can occur. These disputes can originate from administrative issues or be business-oriented. In a complex environment with multiple transactions occurring daily, disputes can often be overlooked. Systems are a helpful tool in providing an internal dispute management system.
  4. Liquidity management and settlement
    Upon the completion of a netting run and all invoices being reconciled, each company will receive a final netting statement, containing their new balance to be paid to or received from the netting centre. When a subsidiary is due to owe money to the netting centre, they will have various settlement possibilities available for use, and systems play an inevitable role to support these settlements. Subsidiaries can settle via bank account wires, take internal loans from the group treasury or book via intercompany accounts. Systems can be used to streamline the settlement process.
  5. Audit trail
    Some systems can provide a fully audit trail on all key variables in the netting process.
  6. Transparency and less manual tasks
    When all stakeholders of the netting process are using one central system where everybody has access to, there is only ‘one source of truth’ that increases transparency and supports consistent involvement of all parties. Systems will also diminish the manual tasks in the process and decrease the vulnerability to errors.

Which system is used for the netting process depends very much on the system landscape of the company. Roughly there are three options:

  1. ERP system
    As the source of the A/R and A/P is the ERP, it makes a lot of sense to use the ERP for the netting process as well. In the following situations the ERP system is not ideal option:
    – when the company has multiple ERP systems
    – when the ERP system lacks netting functionality
    – when treasury has limited access to the ERP for the (internal or physical) settlement of the transactions
  2. Treasury Management System (TMS)
    Many TMS providers can deliver netting functionality that support the full netting cycle. Preferably the netting process is then set up with automatic upload/download interfaces for the input and output data from/to the ERP system(s). It requires that the treasury department takes the lead in the set up and management of the netting process.
  3. Dedicated netting software
    There is variety of other dedicated netting systems available where the netting process can take place. Interfacing with the TMS and the ERP is then even more important. Some companies also use Excel spread sheets for their netting process and that can still be practical solution if there are only limited parties involved, few internal invoices and a small number of currencies.
5. Checklist

To prepare the business case for setting up a netting process that meets the specific requirements of the organization, the checklist of questions below can be used.

1. How many currencies are used for internal invoices?
2. What is the number of local entities?
3. What is the total amount of internal invoices per month, what is the monthly value and who are the counterparties of these invoices?
4. What is the background of the internal invoices: trade, interest, royalties, dividend, hedge contracts internal, fees, loan repayments, investments etc.?
5. In what countries are internal invoices send/received?
6. Which exchange control regulations are existing for cross border transfers and what are the fiscal and legal consequences of netting intercompany transactions?
7. How does the system landscape looks like, where is data stored and in which system(s) will the netting process takes place?
8. Where does FX management take place within the organization and how will that be impacted by the set-up of a netting process?
9. To assess the options for settlement of internal invoices:
– How does the current bank (accounts) landscape looks like?
– Is there already an in-house bank (IHB) structure set up?
10. What are the organizational consequences with respect to the treasury department, accounting processes and corporate policies?
11. Are there adequate resources available in the organization at the relevant departments (such as accounting, IT and treasury) to set up the netting process?

Dominic Hoogendijk and Bas Kolenburg are experienced senior treasury consultants working for Enigma Consulting. Enigma Consulting is a trusted advisor in Payments, Risk & Compliance and Treasury with over 20 years of experience. Enigma Consulting serves all Dutch financial institutions, many (international) corporates and charity organizations.







Does technology actually help you improve your cash management?

| 31-5-2018 | Nicolas Christiaen | Cashforce |

It is a question that many companies have been asking themselves for the past few years. Innovative, dedicated technologies may be very exciting, but the question remains: Are they worth the investment?

We believe the answer is yes, but understanding the technology & its shortcomings are key to exploiting its full potential. Companies that are missing today’s “FinTech train” might find themselves in precarious situations in the future. They risk becoming relatively less productive and might lack insights that their technology-driven competitors will have. This is certainly true when it comes to Cash & Working Capital Management. Technology is definitely an asset in today’s world, as it can help us driving value from working capital. Interconnectivity has risen significantly, with the surge of in-house banks, cash pooling, POBO, ROBO, etc., forcing treasury departments to keep up with the pace and find ways to manage complex treasury set-ups. On top of that, the number of transactions has grown to such a level that only high-level calculations can be done by humans. Technology helps companies to deal with this magnitude of data and reduces complexity by bringing visibility in companies’ cash flows.

Also, the surge of centralization (look at the number of centralized treasury teams) reduced the number of double tasks and improved the efficiency of Treasury Operations. However, at the same time, keeping treasury connected with the business is becoming the new challenge. In this continuous paradox, technology will prove helpful in connecting both worlds.

However, we need a good understanding of limits & shortcomings of technology too. Today’s systems are capable of calculating expected outcomes & action plans based on a set of parameters. However, technology is not smart enough yet to take into account all parameters (like macro-economic parameters, unexpected events, changes of policies) & and most of all human (= irrational) behavior.

There is a legitimate drive towards using technology, as complexity rises, as is the need for more transparency. Two interesting evolutions are simultaneously taking place: Niche players are betting on making the technology smarter, whilst corporates are getting better at smartly using that technology. There is no reason to believe this will stop in the near future.




Nicolas Christiaen

Managing Partner at Cashforce