Leveraging Data for Treasury Decisions: A Single Source of Truth
This article is written by Treasury4 Treasury operations are more complex than ever before. Treasurers must deal with everything from cash and liquidity management to compliance and risk reduction—all across multiple global entities. Adding to these challenges is the issue of siloed data. With accounts across multiple banks, departments, and entities, treasurers are often tasked with tracking down, compiling, and comparing isolated data points. This task is time-consuming and can lead to data disparities, which can, in turn, limit the ability to make timely and accurate strategic decisions. To overcome these challenges, treasury teams need a unified data platform for all their various data. By integrating entity, cash, and banking information into one single source of truth, treasurers can gain comprehensive, real-time insights that reduce inefficiencies, allow for more agile, informed decision-making, and foster alignment with broader organizational goals. In this article, we’ll delve into the problems caused by siloed data, the value of a centralized platform, and the actionable steps to implement one effectively. Challenges of Siloed Data in Treasury Fragmented data systems remain a pervasive problem for treasurers—limiting their ability to manage operations effectively. The ripple effects of siloed data impact critical processes, from cash flow forecasting to compliance and risk mitigation. Common issues include: 1. Disconnected Data Sources Data silos typically result from the use of multiple standalone systems, such as ERP modules, bank portals, and entity-specific spreadsheets. For example, a multinational corporation might operate in dozens of countries, each with its own banking relationships and financial systems. Consolidating this scattered data manually can be an arduous and error-prone task, leading to incomplete or outdated reports, compliance issues, and other risks. 2. Inefficiencies and Inconsistencies The manual processes required to consolidate fragmented data can lead to significant bottlenecks. These inefficiencies are compounded when discrepancies arise between systems, such as mismatched transaction records or differing formats for cash flow data. 3. Limited Visibility Siloed data severely hampers the treasury team’s ability to gain a real-time view of cash positions, leaving them in a position to be reactive instead of proactive. This lack of visibility can lead to: The Concept of a Single Source of Truth To address these challenges, a centralized platform consolidates all treasury data into a single source of truth, providing a reliable, real-time view of the organization’s financial health. Having a single, integrated dataset enables treasury teams to: Key components include of a centralized data platform include: By leveraging centralized technology platforms like Treasury4, treasury teams can create a clear, accurate data flow, breaking down silos and ensuring all stakeholders operate with the same information. Benefits of Data Integration for Treasury Decisions Integrating siloed data into a single source of truth delivers several strategic advantages, including: 1. Enhanced cash visibility A unified platform provides a clear, real-time picture of cash positions across all entities and accounts. This visibility allows treasurers to: 2. Improved forecasting accuracy By integrating historical data with real-time insights, treasury teams can: For example, predictive analytics tools built into advanced platforms can analyze past trends to suggest actionable insights, such as identifying recurring cash flow patterns or potential shortfalls. 3. Streamlined compliance and reporting Compliance is an area where siloed data can cause significant risks. Integrated platforms simplify regulatory and internal reporting by: Treasurers can respond quickly to requests for information, saving time and reducing the risk of non-compliance. 4. Faster Decision-Making Treasury operations often require swift decisions, whether it’s seizing investment opportunities or addressing unexpected liquidity needs. By consolidating data, teams can: How Technology Enables Data Integration Modern technological solutions can give treasurers the tools to centralize data and automate processes. For instance, modern treasury management systems (TMS) like Treasury4 provide: Application programming interfaces (APIs) are critical to providing unified data. APIs connect separate systems in real time, allowing data integration across bank portals, ERP systems, and external compliance or investment tracking tools. Case study: How an integrated system transformed decision-making for one global organization For years, one $4 billion global enterprise relied on various spreadsheets to keep track of its entities spanning over 50 countries and its 150-plus bank accounts. These spreadsheets were often outdated, making it difficult to gain consistent, reliable insights from treasury data. The team needed a system to provide a single source of truth for their banking data, with a reliable audit trail. The team decided to adopt Entity4. Not only could it provide the treasury team with the system of record they needed, but it could also act as a single source of truth for other departments, including legal, tax, and more. After spending a quarter transitioning their spreadsheet data to Entity4, the finance team had access to accurate, reliable reporting on their banking data. The team now has full control over and visibility into their accounts—including the interactions and relationships between accounts—significantly reducing both operational and credit risk. Steps to Transition to a Single Source of Truth Shifting to a single, centralized platform requires a well-thought-out strategy to ensure a smooth transition. 1. Assess current data silos: Conduct a comprehensive audit to identify where data resides, who owns the data, and how data flows between systems. This step helps pinpoint gaps and inefficiencies. 2. Select the right platform: Choose a treasury management system that aligns with your organization’s needs. Consider compatibility with existing systems, real-time reporting and analytics capabilities, and scalability to accommodate your organization’s growth. 3. Foster cross-functional collaboration: Collaboration between treasury, IT, and finance teams is essential to align technology implementation with operational goals. Ensure all stakeholders are involved in decision-making and rollout plans. 4. Implement role-based access: Role-based access controls ensure secure sharing of data, enabling stakeholders to access relevant information without compromising sensitive data. Conclusion Siloed data can present a significant obstacle to treasury operations, creating delays, inefficiencies, and risks. Transitioning to a single source of truth transforms the treasury’s ability to manage cash, liquidity, and compliance. It enhances visibility and forecasting capabilities, allowing for easier compliance management and faster decision-making. Also Read Join our Treasury Community Treasury Masterminds is a community of professionals working in treasury management or…
Franklin
Why was Treasury 2.0: Future-Proofing Finance with AIWritten and Why It Matters Now
In the treasury world, change is no longer a slow evolution. It’s a fast-moving reality. New technologies, shifting expectations, and global complexity are reshaping treasury’s role at a pace most traditional playbooks can’t keep up with. This is exactly why one of our Board Members, Bojan Belejkovski, wrote Treasury 2.0: Future-Proofing Finance with AI. The idea for Treasury 2.0 came from real-world frustration. Despite a wave of technology marketing across finance, treasury teams are often left behind. Even some of the largest technology vendors, when asked how their tools support treasury management, admit that their solutions focus mostly on accounting administration, not on the liquidity, risk, and cash management challenges treasury teams face daily. For too long, treasury professionals have had to rely on outdated materials focused on basics: treasury 101 guides, certification handbooks, or academic theory. Very few resources address the realities of treasury leadership today where AI, automation, and strategic agility aren’t future concepts, but daily necessities. What Treasury 2.0 Provides a Resolution To Treasury 2.0: Future-Proofing Finance with AI directly tackles the growing gap between what treasury professionals need and what traditional resources offer. The book doesn’t just outline the changes happening but it offers practical tools for navigating them. Readers will explore how AI can be used to automate cash forecasting, predict liquidity needs, manage risk in real time, and strengthen decision-making across treasury operations. In particular, the book introduces practical techniques for AI prompt engineering — a skill that can dramatically improve how treasury teams interact with and extract insights from AI-driven systems. The author, Bojan Belejkovski, spent months studying prompt engineering, testing approaches, and seeing firsthand how it increased the quality and accuracy of treasury-related work. This practical knowledge is distilled throughout the book to give readers a clear advantage as they adopt new technologies. Who Treasury 2.0 Is For? Treasury 2.0: Future-Proofing Finance with AI is written for treasury and finance professionals who understand that the old ways of working are no longer enough. It’s for practitioners who are ready to move beyond spreadsheets, static reports, and manual processes and who want to build treasury functions that are faster, smarter, and more resilient. Whether you’re a senior leader setting strategy or a practitioner managing day-to-day liquidity and risk, the book offers a framework for thriving in a world where AI and digital transformation are rewriting the rules of finance. Treasury 2.0: Future-Proofing Finance with AI is available on Amazon. To learn more and get your copy, visit https://a.co/d/a6lMujY today. Also Read Join our Treasury Community Treasury Mastermind is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill out the form below to get more information. Notice: JavaScript is required for this content.
Bojan
Treasury Contrarian View: Should Treasury Really Own Working Capital Optimisation?
Working capital optimization is increasingly seen as a core treasury KPI. But let’s challenge that assumption: Is treasury really the right function to own working capital initiatives—or should that responsibility remain with procurement, operations, and finance? In many organizations, treasury is now being pulled into working capital programs. But is that a strategic fit or a forced expansion of the role? The Case for Treasury Ownership The Case Against Treasury Ownership A Collaborative Approach Rather than assigning working capital ownership to a single function, a more effective model might be: Let’s Discuss We’ll share insights from treasurers, CFOs, and procurement leaders on how to strike the right balance—join the conversation! COMMENTS Wayne Mills, Chief Product Officer at ETR Digital, comments: The question of whether the responsibility for working capital optimisation should fall under the treasury department depends on organisational complexity and structure as well as how accountability is assigned. Working capital optimisation can be said to fit naturally into the treasury function in view of its adjacency to the strategic management of liquidity, funding, cash flow forecasting, financial risk, and bank relationships – indeed, optimising all forms of capital is a key role of treasury. There is, however a more practical view that many elements of working capital are operational and controlled by functions outside the treasury department, including sales, procurement, operations and IT. Treasury insight into these areas may be more limited, leading to sub-optimal outcomes, noting that internal sources of working capital optimisation may be easier to access, cheaper and deliver long-term sustainable solutions. Accountability v Responsibility In my view, Treasury should be accountable for working capital optimisation with other functions being responsible. Embedding a culture of optimisation through aligned cross-functional KPIs will deliver the required outcome – ultimately creating shareholder value. The most important aspect, in my view, is an inherent shared culture of continual improvement – working capital optimisation is not a one-off project; it’s an opportunity to become best in class. It is, after all, a team sport! Eleanor Hill, Freelance Content Creator, Treasury Storyteller, comments: Working capital optimisation (not just management) is ultimately a behavioural and structural challenge. You’re trying to change how different parts of the business make decisions, often without direct authority over those decisions. Treasury can definitely play a valuable role here – not because they ‘own’ the process – but because they’re often the only team with visibility across the full cycle and the motivation to optimise for the whole, not just the parts. But working capital optimisation inevitably means trade-offs. Do we extend terms with suppliers or invest in long-term relationships? Or can we do both? Do we push sales to invoice faster or rework the entire quote-to-cash process? These aren’t decisions treasury can make alone. That said, treasury can frame the choices more clearly (in terms of liquidity, risk, opportunity cost) and help the business approach them more intentionally. Tools like supply chain finance can support this if they’re used thoughtfully. Not just to improve DPO, but to offer flexibility to suppliers and even assist towards ESG goals – like offering better rates to businesses with strong sustainability credentials or inclusive ownership. But again, these tools only work when the underlying strategy is solid and agreed across departments. From every case study I’ve written on this topic (a lot!), I’d say the best working capital optimisation projects have been run by high-performing cross-functional teams. It’s all about collaboration. Nicholas Franck, Treasury Masterminds founder and board member, comments: As it says in the article, several different units work on and are responsible for different parts of working capital. It probably doesn’t stress enough the interrelationship between the areas though. Making life better for procurement and the treasurer can make life harder for sales. Choose any functions – If they’re not working on working capital together, the result is likely to be biased and suboptimal. Match responsibility to authority. The owner should be the owner of whoever controls all the processes, so, usually, the CEO. How? The best way I’ve seen is by having a company wide KPI: Net Working Capital as % of Sales. It encourages all the functions to work together, not fight against each other. Note that it’s net working capital, not gross. Treasury is still in charge of cash and short term debt. It collaborates with everyone else on the rest. It’s clear some companies will benefit better off with Net Working Capital as % of Gross or Net Profit. The principle’s the same: Align authority with responsibility. No one function can own working capital. All functions must want to work together on it. Also Read Join our Treasury Community Treasury Mastermind is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill out the form below to get more information. Notice: JavaScript is required for this content.
Operationalising AI in Treasury: From Experiment to Execution
This article is written by ETR Digital Businesses are moving from AI curiosity to real-world application. And with growing C-suite support, treasury teams are no longer sitting on the sidelines of this digital transformation. According to Operationalising AI – The View from the Top, a recent report by Womble Bond Dickinson, 97% of CTOs say they’re already using AI. Over half (54%) cite data-driven decision-making as a core reason. These aren’t experiments anymore, they’re embedded deployments reshaping processes and financial systems in real time. For Dominic Broom, CEO, ETR Digital – and contributor to the report – this shift is long overdue. “There’s a lot of talk about AI in the abstract, but what matters is how it’s being applied in the real world. Like other digital tools, operationalising AI means turning ‘potential’ into tangible, practical outcomes.” He highlights three areas where this is already happening in treasury: 1. Making financing smarter and fairer Legacy credit models often fail to reflect real business performance. With AI, financing decisions can become more dynamic and tailored – using live operational data rather than outdated financial statements. “We now have the capability to be more bespoke and considered,” says Broom. “AI-driven real-time analytics will allow lenders to adjust risk models and costs accordingly, ensuring fairer financing and ultimately faster economic growth.” This could open up more affordable credit for treasury teams, especially in sectors or regions where capital access has historically been uneven. In turn, more dynamic access to credit could enhance working capital planning, in particular for companies juggling uneven cash inflows or seasonal cycles. AI can also help treasurers model real-time borrowing needs more accurately, reducing reliance on high-cost buffers and unlocking more flexible financing to support the business. As James Kelly, Co-Founder, Your Treasury, notes: “For decades, treasury teams have been stuck managing funding with tools that belong in a museum. AI gives us the chance to break out of backward-looking models and actually align to the real pulse of the business. If collections are accelerating or customer behaviour is shifting, funding decisions should reflect that.” Dan Kindler, Co-Founder and CTO, Bound, adds: “There’s a huge opportunity here for treasury teams to benefit from decisions that actually reflect how their business is operating today – not just how it performed last quarter, or last year. But the key, as always, is having the right data in the right place, at the right time. Without clean, connected financial data, AI will be running on fumes.” 2. Removing friction from cross-border operations Despite progress, cross-border transactions are still plagued by delays, documentation burdens, and red tape. AI offers new ways to automate, predict, and streamline these processes. “AI will play a huge role in international trade by reducing complexity,” says Broom. “And businesses that trade internationally grow faster and are more profitable.” From a treasury perspective, cross-border inefficiencies have a knock-on effect on working capital – whether that’s delayed collections, poor visibility over receivables, or mistimed settlements. With AI, treasurers can anticipate these issues earlier and reduce strain on the cash conversion cycle caused by avoidable delays. Kindler elaborates: “One of the biggest hidden costs in international treasury is the time spent on ‘what-if’ scenarios. What if that payment is delayed? What if the FX rate shifts? What if the invoice is held up? With AI, you can stress-test those possibilities in seconds, not hours, and plan accordingly.” And the cumulative benefit is huge, says Kelly. “Every friction point you remove adds up. A few minutes saved on reconciliation, a reduction in payment queries, fewer compliance chases – it all frees up time and headspace for better, deeper, more valuable work.” 3. Turning data overload into confident decisions Many treasury teams are data-rich but insight-poor. AI changes that, helping to surface what matters, when it matters. As Broom notes: “We don’t have to rely solely on historical data anymore. Real-time data can now be analysed almost instantly to support faster, better decisions.” After all, AI can turn huge volumes of data into valuable information, says Kelly. “But it’s not about building the smartest model. It’s about helping someone make a better decision on a weekday afternoon,” he explains. “Eliminate the noise and automate low value tasks, then highlight the strategic activities and free people up to focus on those areas. That’s how you move from firefighting to forward-thinking.” Kindler also believes better decision-making is the real promise of AI in this space. “We’re using APIs and AI to integrate directly with our customers’ financial data – everything from ERP systems to payment platforms. This helps us automatically identify and quantify their FX risk in real time, so they can be more confident in their hedging strategies.” He adds: “We don’t try to predict the future. That’s not the goal. What we do is give our customers a clear picture of what’s happening now – where the exposures sit, how sensitive their plans are to movements, and what they can do about it. That’s how AI unlocks confident decision-making for treasurers.” Where do we go from here? AI is no longer theoretical. It is increasingly embedded in how businesses and treasury departments operate. But its impact depends on how well it aligns with real problems – and how willing treasury teams are to rethink entrenched processes. Kelly summarises it perfectly: “AI is being operationalised to make financial systems work better. That’s not a side project for treasurers, that’s the job! Now it’s up to them to decide where to apply AI first – and what outdated process they’re finally ready to retire.” See how ETR Digital supports smarter, more efficient financial flows If one process you’re ready to review is how your cash conversion cycle is managed, check out our CCC calculator and chat with us about how Digital Negotiable Instruments can make a real difference. Also Read Join our Treasury Community Treasury Masterminds is a community of professionals working in treasury management or those interested in learning more about various topics related to…
Doing nothing isn’t safe (or free): why FX inertia costs more than you think
This article is a contribution from our content partner, Bracket As a busy treasurer, it’s easy to assume your FX execution is under control – the rates look fine, and no one’s raising flags. But without proper benchmarking, you could be paying far more than you think. Treasury teams are generally meticulous about managing financial risk. But when it comes to FX – where millions can move in seconds – the same discipline often falls down the list. It’s understandable. Teams are overstretched. Other priorities need tackling. And many treasurers assume that rates from banks, brokers, or multi-dealer platforms are ‘fair enough.’ Competition keeps things honest, right? So, no need to benchmark? Not quite. A recent LinkedIn poll by Treasury Masterminds, Bracket, and Treasury Storyteller revealed the reality: A costly blind spot These gaps in FX transparency aren’t just theoretical; they’re real and expensive. As one senior treasury practitioner comments, “In my prior experience as a consultant, I saw far too many companies execute FX transactions at spot with their primary operating banking partner, with no thought of exploring other options.” “Even if treasurers and CFOs are only executing a few large spot trades each quarter, proper benchmarking can generate significant cost savings,” he adds. Platforms that appear competitive aren’t necessarily immune, either. Alexander Ilkun, Treasury Masterminds Board Member, notes: “Even in highly competitive trading environments like FXall or 360T, banks learn through trial and error, adjusting their spreads based on competitive insights and client behaviour. Costs then follow a collective upward trajectory.” It’s something Alex Charles, Co-Founder of Bracket, has seen throughout his 17 years in FX. “Most people don’t realise how much they’re leaving on the table by not benchmarking their FX transactions. It’s shocking. We’ve analysed over £30 billion of FX trades in just nine months and revealed average margin savings of 32%.” “These aren’t outliers,” he adds. “They reflect deep, structural behaviours in the market that often go unchallenged. The opportunity for savings isn’t occasional – it’s systemic.Treasurers often aren’t aware of the scale of the issue. Or don’t feel they have the time or the tools to benchmark in a meaningful way.” Benchmarking is about more than cost It’s not just about catching poor pricing, though; benchmarking can also help teams execute with visibility and confidence. “Benchmarking can assist in identifying the best – and worst – times to trade, even on a daily basis,” says Patrick Kunz, Founder of Treasury Masterminds. “Certain FX pairs or bank combinations perform better at specific times, and only detailed benchmarking can reveal these trends.” With the right data, treasurers can: Inaction isn’t a neutral move Where transparency was once optional, it’s now a clear expectation. Initiatives like the FX Global Code and scrutiny from auditors and investors are pushing corporates to demonstrate best execution in practice, not just on paper. “It’s tempting to view inertia as a neutral choice – a passive decision not to intervene unless something looks obviously wrong,” says Charles. “But the data suggests otherwise. Every un-benchmarked FX trade is a missed opportunity. And every month without transparency means hidden costs are still accumulating.” The real question isn’t why benchmark. It’s how do you justify not doing it, given the evidence? See how your FX trades stack up – for free The good news? Benchmarking doesn’t have to be manual or expensive. Bracket’s Benchmarker tool lets you upload any spot or forward trade – past or present – and instantly see if the pricing was fair. No integrations, no onboarding, and no cost for a trial run.
Data is the new liquidity: Why Treasurers must champion technology for better data management
Our current financial environment is tech-driven, so data is no longer just a support function but a core driver of value. For treasurers, the ability to manage liquidity effectively is dependent on the quality and accessibility of data. However, without the right technology infrastructure, data remains fragmented, outdated, or inconsistent. Implementing the right technology is not just about automation but about transforming treasury through accurate forecasting, improved risk visibility, and faster, smarter decision-making. The consequences of poor data quality in technology rollouts Case example: A global manufacturing firm rolled out a high-end treasury management system (TMS), but due to a lack of integration with regional ERP systems, data inconsistencies resulted in forecast deviations exceeding 15% for 3 consecutive quarters. Case example: A European FMCG implemented a real-time FX exposure module, but mismatches in master data across systems led to unreported exposures, causing avoidable FX losses. Statistic: According to a 2024 AFP survey, 67% of treasurers said “data quality issues” were the main reason technology implementations failed to deliver real-time cash visibility. What the right technology stack enables Note: The impact of technology maturity on forecast accuracy is significant because the more advanced and integrated your technology systems are, the more reliable, timely, and actionable your financial forecasts become. The blueprint for building a data-ready treasury tech stack If your treasury function is ready to modernize, start with this 5-step roadmap: Statistic: Organizations with fully integrated treasury tech stacks report 50% fewer manual interventions and 30% faster strategic decision-making cycles (Deloitte, 2023). Conclusion: The digital Treasurer’s new mandate We are in a time where liquidity depends on data, and data depends on technology, so the treasurer’s role is now part technologist, part strategist. With the right systems, processes, and partnerships, treasury can deliver the insights and agility executives need to lead through uncertainty. But this transformation doesn’t happen overnight. It starts with a mindset shift from seeing tech as a cost center to recognizing it as a strategic enabler. Are your systems enabling the data intelligence your treasury needs? Now is the time to lead technology adoption that turns data into a strategic asset. Also Read Join our Treasury Community Treasury Mastermind is a community of professionals working in treasury management or those interested in learning more about various topics related to treasury management, including cash management, foreign exchange management, and payments. To register and connect with Treasury professionals, click [HERE] or fill out the form below to get more information. Notice: JavaScript is required for this content.
Jessica
Strategies for Setting Up a Cash Pooling Structure Across Multiple Countries and Regions
This article is written by Palm In an increasingly globalized business environment, effective cash management has become a cornerstone of financial efficiency for multinational corporations. Cash pooling, a financial mechanism that consolidates the balances of multiple accounts into a single master account, has emerged as a vital tool for optimizing liquidity, reducing costs, and enhancing operational flexibility. However, implementing a cash pooling structure across multiple countries and regions presents unique challenges, including regulatory compliance, tax implications, and operational complexities. We’ll share the top strategies for establishing an efficient and compliant cash pooling structure, tailored to the needs of companies operating in diverse international markets. By leveraging advanced methodologies and understanding the nuances of different jurisdictions, businesses can unlock the full potential of cash pooling to streamline treasury operations and drive financial performance. The Importance of Cash Pooling in International Operations Cash pooling offers significant benefits for multinational companies by centralizing cash management. It enables businesses to reduce reliance on external financing, optimize interest income, and ensure better allocation of surplus funds. For example, hybrid cash pooling—a combination of physical and notional pooling—has gained traction as a flexible solution for companies with varying financial needs across subsidiaries. This model not only unlocks cash efficiency across multiple currencies and entities, but operationally allows companies to manage funding on dozens to hundreds of account while mostly managing one funding account. Challenges in Cross-Border Cash Pooling Despite its advantages, implementing cash pooling across multiple countries is far from straightforward. Each jurisdiction has distinct regulations governing fund transfers, exchange controls, and taxation. For instance, some countries impose restrictions on cross-border transfers or require specific approvals, which can complicate the pooling process. In China, recent enhancements to cross-border cash pooling policies by the People’s Bank of China (PBOC) and the State Administration of Foreign Exchange (SAFE) have streamlined processes and reduced costs, making it a more attractive option for MNCs (UDF Space). Moreover, legal and tax considerations, such as withholding taxes and thin-capitalization rules, must be carefully analyzed to ensure compliance. The choice of banking partners and technological platforms also plays a critical role in overcoming these challenges and achieving seamless integration of cash pooling systems (Euroaccounts). The Need for Strategic Planning To successfully implement a cash pooling structure, companies must adopt a strategic approach that aligns with their financial objectives and operational realities. This involves conducting a thorough analysis of liquidity needs, selecting the appropriate pooling model (physical, notional, or hybrid), and ensuring compliance with local regulations. Regular reviews and adjustments to the pooling strategy are essential to adapt to changing market conditions and regulatory landscapes This blog aims to provide actionable insights and best practices for setting up and optimizing cash pooling structures across diverse regions. By addressing the complexities of cross-border operations and leveraging innovative solutions, businesses can enhance their financial resilience and maintain a competitive edge in the global marketplace. Understanding Regulatory and Legal Considerations for Cash Pooling Across Regions 1. Navigating Country-Specific Cash Pooling Permissions Cash pooling is not a one-size-fits-all solution. Each country has its own set of rules, and understanding these is akin to solving a Rubik’s cube blindfolded—challenging but doable with the right strategy. In some regions, cash pooling is fully permitted, while in others, it’s partially allowed or outright restricted. Anecdotally, Europe is a relatively relaxed environment for cash pooling and cross border sweeps with most major banking hubs offering products to corporates. In contrast, pooling in LatAm in Asia can prove to be more challenging. Although things are evolving.For instance, countries like Thailand have recently relaxed regulations, enabling onshore FX conversion, which allows USD balances to be pooled offshore (Standard Chartered). This move unlocked significant liquidity that would have otherwise been trapped locally. In contrast, Vietnam is still deliberating the feasibility of intercompany loans, which are currently not permitted. Meanwhile, China continues to evolve its stance through pilot programs aimed at optimizing cross-border cash pooling for multinational corporations (Global Times). These pilot programs, rolled out in cities like Shanghai and Beijing, aim to streamline the pooling of both foreign and domestic currencies. The choice of banking partner also plays a pivotal role in navigating these permissions. Some banks may have the required special permits, while others may not. For instance, Singapore and Malaysia have embraced innovative banking networks, such as direct debit systems, to simplify cash pooling (Standard Chartered). 2. Tax Implications: The Elephant in the Room In cash pooling, tax authorities often view intercompany cash transfers as loans, which can trigger tax consequences. For instance, transfer pricing regulations may require that intercompany cash transfers be conducted at arm’s length, meaning you can’t just shuffle money around without proper documentation (Euroaccounts). In Europe, tax implications are particularly pronounced due to the EU’s Anti-Tax Avoidance Directive (ATAD), which scrutinizes intercompany financial arrangements. Non-compliance can lead to penalties and increased tax liabilities. Similarly, in Asia, countries like India and China impose strict documentation requirements to ensure that cash pooling does not lead to tax base erosion. Moreover, withholding taxes can complicate cross-border cash pooling. For example, if a subsidiary in Germany transfers funds to a parent company in the United States, withholding tax may apply unless a tax treaty provides relief. This makes it essential to consult tax advisors who specialize in international taxation (Tolley). 3. Legal Structures: The Foundation of Compliance The legal structure of your organization can make or break your cash pooling strategy. Imagine building a skyscraper on a shaky foundation—it’s bound to collapse. Similarly, a poorly designed legal structure can lead to compliance nightmares. For instance, undercapitalization of subsidiaries can raise red flags for regulators, as it may indicate that cash pooling is being used to siphon funds rather than optimize liquidity (Stahr Advisory). In China, the People’s Bank of China (PBC) and the State Administration of Foreign Exchange (SAFE) have specific requirements for cross-border cash pooling, including minimum capital thresholds and detailed reporting obligations (Global Times). Similarly, in the United States, the Dodd-Frank Act imposes stringent requirements on intercompany financial arrangements to prevent systemic risks. Choosing the right type of cash pool—physical or notional—also impacts legal compliance. Physical pools involve actual fund transfers, which are subject to…
Treasury Contrarian View: Do We Focus Too Much on Finance Backgrounds in Treasury Hiring?
Traditionally, treasury professionals have been hired for their financial acumen—degrees in finance or economics, certifications, and prior banking experience. But in today’s digital-first treasury environment, here’s a bold question: Should we stop prioritizing finance backgrounds and start hiring more technologists, data analysts, and engineers into treasury teams? The Case for Rethinking Treasury Talent The Case for Keeping Finance at the Core The Way Forward: Cross-Functional Treasury Teams Rather than replacing one skillset with another, treasury functions can evolve by: Let’s Discuss We’ll feature insights from tech-forward treasurers and talent leaders who are reshaping how treasury teams are built—add your voice to the conversation! COMMENTS Patrick Kunz, Treasury Masterminds founder and board member, comments: “It is disheartening to see so many entry-level Treasury roles demanding multiple years of direct experience. How are junior professionals supposed to break into the field when the door is constantly slammed shut? It feels like companies have completely abandoned the idea of training and investing in new talent. This “experience only” mentality is creating a massive barrier for aspiring Treasury professionals. While experience is valuable, a lack of willingness from companies to provide structured training and mentorship is a significant hurdle“. This message I got from a junior in treasury who FINALLY landed an entry-level role. I blame the companies she applied to. They have to train for skill and should have hired for EAGERNESS and GRIT and she would have thrived in her role as she later complained that her role is very operational and didn’t even require a lot of skill. At Pecunia, I see a shift in both junior and medior roles on the skills. The TECH skills are becoming more critical to win roles. Understanding data and interdependencies and their sources and being able to extract them and get relevant information from them is key in some analyst or even some cash/treasury manager roles in smaller organisations. This doesn’t mean treasury talent shouldn’t have a finance background anymore. Dealing with data, you should still be able to interpret them and understand them. Finding the one that knows both would be perfect but is also hard to find. This means a company has to decide what skill is more important from the start. Though every skill can be taught. In my opinion, I would hire for the skills that are lacking in the rest of the team. This is also diversity. This can be a tech skill, but it can also be a (younger) mindset or cultural background. Anyway, don’t be too hard on the paper skills and university background or courses one has done. The rest of the treasury team already has that skill so why add another one with less practical experience in that skill? Adding NEW skills will grow the WHOLE team. Are you a junior unable to land that job because of missing experience in treasury? Don’t be sad and keep looking for a company that values the skills you DO have or might even be better in as the rest of the treasury team. A company that is willing to TEACH you those treasury skills but also appreciates what you DO know will also be a better company to work for, one where you can grow. Alexandar Ilkun, Treasury Masterminds board member, comments: It would be a sad day when a finance background stops to matter in Treasury. The good thing is that I don’t believe it’s anywhere on the cards, not now nor in the foreseeable future. No matter how automated the process is, it is important to understand what the outcome of the process should be. That can only be achieved if the person reviewing the results understands and knows what to expect based on their knowledge and experience. Such an expert is often able to say whether the numbers make sense or not. They also know where to look for potential issues and how to dig out the root cause of those issues. However, with the technological advancements, it has become crucial for Treasury professionals to also understand how the automations work. It helps to know what is happening under the hood technically. It has a couple of benefits. First, you know what the potential weak points are so know to look out for signs that something went wrong from an automation standpoint. Secondly, you also know the power and indeed the limitations of automations. As someone who built a sufficient number of them, I learned to appreciate that automations are great but require some degree of maintenance—the more complex the process, the more maintenance it may require, as there are more areas that can potentially go wrong. Finally, I’d also add that there is certainly a place for Treasury Technology Teams to exist these days or for bringing such an expert in on a consulting/outsourcing basis. Not only do you have access to experts that are within the Treasury team and focus on its needs as opposed to a more generalist IT or Data Scinetist, whose time will be devoted to one of the competing priorities coming from all around the organization. Having access to this expertise alongside operational Treasury knowledge allows you to be able to develop solutions much more quickly and much more tailored to the needs of your individual team that alleviate specific pain points that are relevant to you and without the need to think about the competing projects that may be out there. In my practice, having access to Treasury Technology Talent allowed me to create solutions faster, better, and that are innovative—since doing something new is an art that often doesn’t survive the stage of business requirements documentation any IT person would require. Jessica Oku, Treasury Masterminds board member, comments: Treasury is becoming tech-driven As someone who has led treasury teams through digital transformations, I can confirm this evolution is not just coming; it’s already here. In fact, some of the most successful treasury turnarounds I’ve worked on were driven by using real-time data visibility, automation tools,…
You’re Doing Payments Wrong—And It’s Costing You Strategic Control
Why centralization alone isn’t enough—and how POBO and in-house banking change the game Here’s the thing most companies get wrong: they treat centralized payments like an efficiency play. Fewer bank accounts. Bulked payments. Lower admin burden. And while that’s not wrong, it’s barely scratching the surface. Because when you design centralized payments with strategy in mind—when you align structure, technology, and control—you unlock far more than savings. You create visibility, leverage, and agility across your entire global financial operation. And if you’re not aiming for that, you’re leaving value on the table. A lot of it. The False Comfort of “Centralization” Many organizations are proud to say they’ve built a payment factory. In practice, that often means they’ve centralized operational processing—moving payment execution into a shared service center, consolidating teams, and reducing cost per transaction. It’s a step in the right direction—but it’s not strategy. What they’re really doing is centralizing labor, not control. Most payment factory models continue to process payments from each entity’s accounts, on their behalf, under their name. The model is operationally efficient, but it stops short of transforming financial ownership or visibility. It’s about processing payments faster and cheaper—not smarter. This mindset tends to focus on cost reduction: using lower-cost labor, often offshore, to process more payments at a lower price point. And that’s fine—if the goal is operational efficiency. But that’s not where the real value is. The strategic leap happens when organizations move from shared processing to Payments on Behalf Of (POBO)—a structure that routes payments through a limited set of centralized accounts, executed legally and operationally by a central financing entity or designated shared-service structure. POBO doesn’t just centralize execution—it consolidates control. It reduces accounts, enhances oversight, simplifies FX, and becomes a foundation for broader financial integration. What Strategic Control Actually Looks Like Once organizations make the shift from centralized processing to POBO, the conversation moves from operations to control. POBO isn’t just a payment method—it’s a structure for establishing real-time financial visibility, reducing complexity, and driving better decision-making across treasury and finance. In my 25 years of experience driving treasury transformation projects for corporate leaders around the world—including Booking Holdings, Chevron, Estée Lauder, Microsoft, and Texas Instruments —I’ve seen what happens when POBO is done right. These companies have built some of the most advanced global treasury infrastructures in the world—leading-edge solutions designed to optimize payments, reduce risk, and increase agility. Treasury becomes predictive, not reactive. Working capital gets deployed more efficiently. And payments become an engine for visibility—not just execution. Strategic control means knowing where your cash is, where it’s going, and what it costs—in real time. It means consolidating power without sacrificing flexibility. It means enabling real-time, data-driven decisions around liquidity, FX exposure management, and audit readiness. This is the backbone of a treasury function that’s designed to lead. The Design Decisions That Make or Break POBO Strategic design is where most projects go off-track. Companies underestimate the number of decisions that must align across treasury, AP, tax, and IT. They rush implementation without building a framework that answers key questions like these—questions that matter even more when POBO is ultimately integrated into a broader treasury structure. Each of these isn’t just a technical preference—it’s a strategic lever. Done right, they enable flexibility and scale. Done wrong, they lock you into workarounds and inefficiencies that erode value and confidence. From Payment Factory to Strategic Infrastructure Centralized execution is a starting point. But without structural integration, it remains just that—a start. A payment factory reduces friction. An in-house bank (IHB) redefines control. At its core, an IHB is a centralized legal and operational entity—often a financing affiliate—that acts as the internal bank for a company’s subsidiaries. Rather than each entity maintaining its own external banking relationships, the IHB manages payments, collections, intercompany loans, and foreign exchange centrally. It moves beyond shared processing by consolidating financial ownership and liquidity management into a single, strategic structure. As Citibank notes in their article In-house Banks: As Relevant as Ever in Today’s World, “In-house banks may not be a riveting topic, yet they remain a linchpin of top-performing corporate treasuries.” And while adoption is still growing, the trend is clear: This progression isn’t just about size—it’s about strategic maturity. The companies adopting in-house banks are the ones managing complexity at scale. And the fact that so many haven’t yet adopted one? That’s not a weakness of the model—it’s an opportunity. POBO embedded in an in-house bank doesn’t just streamline execution—it becomes the structural framework that supports FX management, intercompany lending, liquidity forecasting, and more. It’s not just a better way to pay—it’s a smarter way to operate. For a deeper understanding of in-house banking and its benefits, check out Serrala’s guide, In-House Banking: The Strategic Advantage for Treasury Professionals. Technology Enables the Shift—But Only If You Design for It For corporates leveraging SAP as their ERP system, technology like SAP’s Advanced Payment Management In-House Bank (APM-IHB) facilitates this transition—from a standalone payment factory to a fully integrated treasury platform. APM-IHB brings together centralized payment routing, virtual accounts, automated balance tracking, seamless end-to-end processing, and real-time intercompany postings into a single environment that connects POBO with the broader in-house banking ecosystem. When combined with SAP’s Multi-Bank Connectivity (MBC), this infrastructure extends all the way to external banks—enabling direct communication without file transfers. The result is a secure, real-time, fully traceable workflow from invoice to execution, with full audit trails and embedded compliance. This kind of design creates the foundation for strategic enablement: real-time visibility, stronger fraud controls, improved compliance, and actionable insight across the enterprise. That said, the tech can’t carry the strategy on its own. It’s the execution of the design—not just the platform—that determines whether you get a scalable, strategic outcome or just another centralized process. AI Is Coming—But Only If Your Data Is Ready Artificial intelligence isn’t optional anymore—it’s a differentiator. In treasury, it’s reshaping forecasting, risk modeling, anomaly detection, and exposure planning. But AI is only as effective as the…
PETER.WOLF@SERRALA.COM