this article talks about how to implement a IHB. Which is not an easy task and a big project.
So where to start? Should it start with POBO (payment on behalf) as that is fairly easy to implement. Or only IC Loan flows, potentially even easier but it “saves” less cashflows.
Tips and tricks are welcome on this. Share your experiences.
How do you face centralization in complex countries? Do you think global companies will be forever limited to hybrid solutions when implementing centralization solutions?
as long as these complex countries will remain complex I think the answer is yes unfortunately. They just do not fit into automation or global connectivity.
Inhouse banking can be used for multiple reasons like mentioned. The purpose is important i.e depending on business need (Dealing on behalf can be added to the list 😉)
One of the key requirement is to have a proper TMS/ ERP system to record, administer (open en close the day), calculate interest and create inhouse bank statement. First step that support most of the purpose is to have a proper bank account structure e.g for POBO, ROBO, cash pool transactions (sweeps)
Inhousebank and inhousecash are connected processes that can bring lot of efficiency.
I would also add intercompany clearing to the list.
Due to regulations, IHB will be always limited to certain cashpoolings, PoBO, RoBO and also ICC or centralized FX dealing. Plus, you can reduce # of bank accounts, but in many countries you need to pay at least taxes and customs with local bank accounts as enforced by the local authorities.
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