Building resilience through treasury policies
This article is a contribution from our content partner, TreasurySpring Following our webinar on Treasury Policy, it’s clear that the evolving financial landscape presents both challenges and opportunities for treasurers. The discussion shed light on the critical role of treasury policies in guiding organisations through uncertainty, fostering resilience, and embracing innovation. This blog captures the webinar’s key insights to help organisations stay ahead in 2025. Importance of treasury policies Treasury policies are more than just procedural documents; they’re the backbone of financial governance. They serve as essential frameworks to manage cash, foreign exchange, debt, compliance, and banking relationships. Effective treasury policies ensure consistency, provide clear guidance for stakeholders, and establish measurable benchmarks for performance, making them indispensable for organisations aiming to navigate challenges with confidence. As a treasurer, they’re your license to act. 2025 challenges and adjustments Navigating interest rate volatility The Federal Reserve’s uncertain trajectory on interest rates continues to create market turbulence. This interest environment will require treasurers to remain agile, conducting out-of-cycle policy reviews to reassess investment strategies. What may be an annual or bi-annual review cycle, in times of uncertainty, can be increased to ensure you have the right risk exposure and controls. This proactive approach ensures that organisations can pivot quickly, safeguarding returns, and minimising risk. The rise of Bitcoin and digital assets With increasing regulatory clarity and institutional adoption, boards are urging treasurers to assess the feasibility of incorporating digital assets. While this represents uncharted territory for many, it underscores the need for forward-looking treasury policies that adapt to emerging trends. Evolving treasury policy best practices Striking a balance between flexibility and governance For multinationals with treasury teams operating across geographies, ensuring some degree of decentralisation of decision-making to account for regional nuances is important. The general philosophy of the policy should be the same everywhere, but global teams need flexibility for regional variations, particularly in areas with: exchange controls; less robust banking systems; limited financial options; different payment processing requirements etc. Quantifying policy parameters Clear, measurable guidelines, such as FX exposure limits or weighted average maturity targets only enhance a policy’s effectiveness. These metrics provide treasurers with actionable insights and a concrete framework for decision-making. Socialising policy changes Securing buy-in from audit committees, CFOs, and other stakeholders early in the process fosters trust and accelerates approval for policy updates. Transparency and collaboration are key to ensuring seamless implementation. Emerging topics in treasury Integrating artificial intelligenceAI is revolutionising treasury operations, offering unprecedented efficiency. However, this innovation comes with risks. Policies must govern the use of AI tools, ensuring compliance with data security standards and mitigating the potential for breaches or errors. By addressing these challenges head-on, treasurers can leverage AI’s benefits without compromising security. Strengthening bank and vendor management Effective management of banking relationships remains a critical challenge. Treating banks as vendors, with clear oversight, transparency, and cost-control measures is essential. Regular reviews and structured policies can help mitigate risks associated with poor account management. Enhancing cybersecurity in treasury operations With cyber threats on the rise, treasurers must prioritise cybersecurity. Regular penetration tests, employee training, and robust callback protocols are vital to safeguarding financial systems. Additionally, periodic reviews of cybersecurity insurance and internal disaster recovery plans ensure preparedness against potential breaches. As treasurers face an era of unprecedented challenges and opportunities, robust and adaptable treasury policies are more critical than ever. From navigating macroeconomic uncertainties to embracing technological advancements, these frameworks should enable organisations to remain resilient and forward-looking. And by staying proactive and collaborative, treasury teams can turn policy into a powerful tool for navigating the complexities of 2025 and beyond. *TreasurySpring’s blogs and commentaries are provided for general information purposes only, and do not constitute legal, investment or other advice. 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 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.
Formula for trouble: why Excel can’t handle FX portfolio management anymore
This article is a contribution from our content partner, Bracket Spreadsheets have served treasury teams well – but markets, tech, and FX risk have moved on. It’s time to rethink how you manage your foreign currency portfolio and stop clicking on that familiar green icon. Love it or hate it, Excel is embedded in treasury workflows across the globe. But what started in the 1980s as a flexible, go-to tool has become a bottleneck – especially for mid-market teams managing multi-entity, multi-currency portfolios in fast-moving conditions. As Pierre Anderson, Co-Founder, Bracket, explains: “It’s not that Excel is broken per se. It’s just not designed to handle the complexity of modern FX portfolios. And it’s holding many treasury teams back.” Here’s why spreadsheets are no longer cutting it: 1. Markets move fast. Excel doesn’t FX is a real-time market. Spreadsheets are typically static (unless you do the work to automatically pull in rates, which many teams don’t have the in-house skills or resources to achieve). So, by the time treasury has updated yesterday’s rates and rebuilt its exposure view in Excel, the market has already shifted. “That delay has both operational and strategic impacts, weakening decision-making and potentially increasing risk,” cautions Anderson. 2. Risk management shouldn’t rely on VLOOKUP In addition to the lack of real-time data, when markets are calm, spreadsheets can give the illusion of control. But in volatile conditions, the cracks become obvious. “Rather than being purely reactive to market moves, treasurers are increasingly looking to be proactive around their FX exposures, running stress tests, modelling worst-case scenarios, and determining clear courses of action,” elaborates Anderson. But Excel isn’t built for that. “Simulating the impact of a 5% move in EUR/USD on cash flow, for example, typically requires manual inputs, duplicated tabs, and formula checks. Often, it also means hours of work – and the potential for human error can lead to a lack of confidence in the result,” he notes. The problem with Excel isn’t just humans, of course. It’s more structural: “All this means there’s no real safety net. And when you’re managing millions in FX exposure, that’s not only inefficient, but also dangerous,” explains Anderson. 3. Your team is working around the system, not with it Many treasury teams have built complex workarounds just to make Excel behave like an FX portfolio management tool. They’ve added macros, linked files, and built templates with tabs for each counterparty and/or currency. And in some cases, they’ve created truly impressive set-ups (with very limited resources). Until a link breaks and things unravel. Or the key person who built the macros decides to leave, taking their knowledge with them. As Anderson points out: “This kind of workaround also means highly qualified professionals are buried in repetitive maintenance tasks, spending more time updating spreadsheets than thinking about pricing, timing, or strategy. Understandably, team members become frustrated. It’s not sustainable and doesn’t add value.” 4. Fragmented files mean fragmented decisions Another challenge facing many mid-market businesses is that FX exposure doesn’t live in one place. There is no single source of truth. As Anderson explains: “Different business units often maintain their own spreadsheets. Trades might be logged in different formats. Subsidiaries might also update their numbers at different times. Group Treasury is then expected to manually piece together a coherent view from scattered sources.” Unsurprisingly, this approach can be time-consuming and unreliable. “We’ve also seen teams double-count trades because of mismatched formats. Or miss exposures entirely because of delayed updates. Another common issue is making hedging decisions based on partial data, only to revise them days later when new numbers surface.” In other words, this fragmentation makes it much harder to act decisively or explain the company’s true risk position. Time for a rethink What’s clear to Anderson (and no doubt many treasury leaders) is that Excel was never meant to be the main tool for managing currency risk. It’s become the default because it’s accessible, affordable – and already in place. But when Excel starts hampering decision-making, limiting talent, and draining value from the function, it’s time to think again. “I’m not advocating entirely ditching Excel! It’s just about choosing the right tool for the job,” explains Anderson. “Spreadsheets are still useful. But they’re not enough for managing currency exposure at scale. And we see more mid-market firms making the switch to dedicated FX portfolio management tools. Because they’ve realised that Excel was creating blind spots they couldn’t afford to ignore.” In contrast, a centralised FX portfolio management platform creates a single source of truth. “Everyone sees the same data. Everyone works from the same numbers. And when a fast decision is needed, treasury is prepared and ready, not busy reconciling.” The benefits are real: And perhaps most importantly, a team that’s no longer buried in ‘busywork’, thanks to the significant reduction in time spent on manual data entry and reconciliation As Anderson concludes: “Spreadsheets have served their purpose, and still do in many areas. But FX portfolios have evolved. The tools we use to manage them need to evolve too. Because when you’re using something that wasn’t built for the job, you’re not managing risk. You’re adding to 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.
The US, China and the New Economic Reality – Waiting for What Comes Next
This article is written by HedgeGo The geopolitical and economic landscape is undergoing profound change. The US is at the centre of a global restructuring process accompanied by strategic economic policies. Changing approaches to trade and fiscal policy play a key role, in particular the increasing use of tariffs as a primary instrument for asserting economic interests. The State of the US Economy The United States runs large trade and current account deficits, which are offset by capital inflows from abroad. This means that foreign investors buy US assets to offset the deficits. At the same time, high fiscal deficits reinforce this mechanism by stimulating consumption and overall demand in the US. The result is rising deficits and increasing dependence on external capital flows. One solution to this problem would be a drastic fiscal consolidation programme. However, this would have serious negative consequences, ranging from a slump in consumption and a correction of overvalued financial markets to a possible recession. The associated collapse in demand for US dollars would severely disrupt the international currency structure and reduce the attractiveness of US assets. It seems highly unlikely that the US would be willing to pay this price for economic stability. Instead, it will continue on its current course: an externalising approach to economic policy that seeks to pass on the costs of its own surpluses and deficits to external actors. US Economic Power Set to Wane One aspect that is often underestimated is the role of the US in global trade in services. In particular, the large technology companies on NASDAQ generate a significant proportion of their revenues abroad – around 41% of their revenues come from international markets. Free access to these markets is therefore vital for the US economy. But there is a potential risk here: If countries under pressure use access to their markets as a bargaining chip or favour alternative suppliers, the US could find itself on the economic defensive. This is particularly true of regions that are vital to the global economy because of their resources or economic structures. Countries in Africa, Latin America and Asia increasingly have economic alternatives – especially China – that allow them to break away from their one-sided dependence on the US. A deeper tectonic shift in economic power structures is emerging. China in the Right Position China’s economic rise in recent decades has been dynamic, but not without excesses and structural challenges, for example in the property sector. Nevertheless, the country has established itself as a global economic partner and increasingly offers alternatives to US-led structures. While the costs of an economic exit from the US would have been prohibitive in the past, they are now much more calculable. This opens up new opportunities for countries that want to escape Washington’s economic pressure. Most importantly, China is no longer just catching up economically, but is already competing with the US in a number of technological and strategic areas, such as artificial intelligence (DeepSeek). As a result, the United States is increasingly losing its role as the hegemon with no alternative, which could have long-term consequences for the global economic system. Adaptability as a new core competency. Current developments are characterised by increasing volatility. In times like these, adaptability becomes a critical skill – not only at the government level, but also at the corporate level. While treasury departments have focused heavily on process optimisation and risk mitigation over the past 15 years, they are now faced with the challenge of adapting to a rapidly changing reality. Companies that do not develop this ability to adapt will find themselves unable to act in times of crisis. Processes that ensure efficiency in stable times may prove useless when economic conditions change fundamentally. Conclusion The coming years will be characterised by economic restructuring, geopolitical power shifts and increasing uncertainty. The US has failed to address its structural weaknesses through sustained reform and is instead trying to shift the costs of its economic strategy to other players. At the same time, China is emerging as an alternative economic power, offering new prospects for countries seeking to break away from US dominance. In such an environment, stability and predictability are increasingly illusory. The successful players will be those who can adapt quickly and flexibly to new circumstances. The era of stable processes is being replaced by an era of adaptive resilience. 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 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.
The Evolution of Payments: Non-Banks and Corporate Treasury
From Treasury Masterminds In recent years, a notable shift has occurred in the payments landscape, where traditional financial institutions (FIs) are no longer the exclusive gatekeepers of financial transactions. Increasingly, companies outside the traditional banking sector, including tech giants like ByteDance (parent company of TikTok) and Huawei, are obtaining licenses to operate payment services. This trend marks a significant evolution in how payments are managed and underscores the growing role of non-bank entities in the financial ecosystem. The Rise of Non-Bank Payment Providers Historically, payment services were dominated by banks and financial institutions due to regulatory requirements and infrastructure complexities. However, advancements in technology and changing regulatory landscapes have opened doors for non-bank entities to enter the payments space. Companies like ByteDance and Huawei, with their extensive user bases and technological capabilities, are leveraging their platforms to offer integrated payment solutions. Implications for Corporate Treasurers For corporate treasurers, this shift presents both opportunities and challenges, necessitating a shift in skill sets and strategic focus: Looking Ahead: Balancing Innovation and Risk While the entry of non-bank entities into payments introduces innovation and competition, it also raises questions about data security, consumer protection, and market stability. Corporate treasurers must navigate these challenges while driving innovation and growth within their organizations. Conclusion The trend of non-banks and tech companies obtaining payment licenses marks a pivotal moment in the financial industry’s evolution. For corporate treasurers, embracing these changes requires proactive adaptation to leverage new opportunities while navigating regulatory complexities and safeguarding financial interests. As the payments landscape continues to evolve, treasurers play a crucial role in shaping strategies that balance innovation with risk management, ensuring sustainable growth and resilience in a dynamic market environment. 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.
The Dream and Dilemma of Multi-National Digital Currencies: Promise or Pipe Dream?
This article is a contribution from our content partner, Deaglo What Is an MNDC? A multi-national digital currency (MNDC)—a shared digital medium of exchange issued and accepted by multiple countries—carries both significant potential and complex challenges. The Case For MNDCs: Efficiency, Inclusion, and De-Dollarization The main benefit of an MNDC is reduced transaction costs and frictions. Remittance costs fall, and cross-border payments become more efficient and cheaper by bypassing intermediaries and multiple currency exchanges. Also, real-time settlements are a huge benefit. Instant or near-instant clearing and settlement of payments improves cash flow and reduces counterparty risk. It’s perhaps a dream that will never materialize, but a shared digital currency could promote economic cooperation and integration within regions (e.g., LATAM/MERCOSUR, ASEAN). It would definitely boost trade by reducing the uncertainty of currency fluctuations. Hidden Gains: Real-Time Settlement and Monetary Credibility A less obvious but similarly important advantage is that smaller or less stable economies can benefit from anchoring their monetary system to a larger, stable multi-national framework. It can also enhance credibility and reduce inflation in jurisdictions with weak monetary institutions. For the smallest or poorest jurisdictions, MNDCs can help integrate unbanked populations into the financial system through digital wallets. Perhaps the most discussed advantage recently is the desirability of de-dollarization -an MNDC would reduce dependence on the USD and its clearing mechanisms, redistributing global monetary power and reducing dollar dominance. Economic Sovereignty at Stake: The Major MNDC Tradeoff The biggest downside of an MNDC is the loss of national monetary policy autonomy. Member countries would lose control over interest rates, inflation management, and currency adjustments—especially problematic during economic shocks or asymmetric crises. Central banks may not be able to respond effectively to domestic conditions without being able to control interest rates or issuance volume. Central banks would be relegated to operating under a regional monetary council or policy board, similar to the ECB. Central banks would still likely manage liquidity provisioning to and regulation of domestic financial institutions. Balancing privacy rights with AML/KYC obligations would still be left with central banks working with regulators. Policy Gridlock and Regulatory Discord Differing regulatory regimes, privacy standards, AML/KYC requirements, and tax rules could hinder implementation. Looking at how long it took the ECB to become a functioning unit, and how fractious the EU/ECB is today, reaching consensus on governance, issuance rights, and monetary rules among sovereign states is nigh on impossible. Disagreements could even lead to political instability. Digital Risks and Systemic Threats Lastly, there are significant cybersecurity and operational risks. A digital currency introduces new risks of hacking, fraud, or technical failure, with large-scale economic consequences. The infrastructure must be secure, resilient, and interoperable across borders. A Realistic Alternative: The Rise of CBDCs Currently, there are timid forays into national digital currencies. These are so-called stable coins, backed by fiat currency. You could call these National CBDCs (Central Bank Digital Currency). Issuance and management would be by individual central banks. This would give them full autonomy over monetary supply, interest rate setting, and currency circulation. This control would allow tailoring to local economic goals and policy tools. Citizens already familiar with their own central bank are more likely to trust and adopt a national digital currency. Cross-Border Problem Still Unsolved However, they still don’t solve the cross-border problem. MNDCs provide seamless cross-border transactions within member countries. There is no FX risk or cost, which is a huge effect (and would eliminate a great deal of banks’ profits with the disappearance of derivatives!). With a CBDC, cross-border ecosystems are fractured; each CBDC must interoperate via bridges or hubs of some sort (TBD). To many countries’ delights, MNDCs reduce reliance on external currencies like USD or EUR. They could empower regional blocs (e.g., Mercosur, CELAC) to assert economic sovereignty. The BRICs Digital Currency Fantasy: Political Fractures and Monetary Chaos There has been a lot of talk (but no substantial action other than some fraudulent videos released by Russia) about a BRICs currency. This is pure fantasy. BRICs are not a politically homogeneous bloc. They span democratic and authoritarian regimes, with varying levels of openness, transparency, and geopolitical alignment. More importantly, these economies maintain radically different currency regimes that would be impossible to reconcile: There’s already competition among them for control- China, India, and Russia may each want to lead or host the MNDC infrastructure or reserve system. Also, each country has its own national digital currency ambitions (e.g., e-CNY, Digital Rupee, Digital Ruble), which is counter to an MNDC. Establishing a common policy rate or jointly managing digital monetary supply is nearly impossible without deep monetary convergence and political alignment. Additionally, volatile inflation and interest rates in countries like Brazil and South Africa make it doubly hard. The group would need to create a new supranational monetary governance framework. This would face strong resistance, especially from China, Russia and India, who may not want to dilute sovereignty or accept external control. Conclusion: MNDCs Are a Vision of the Future—Just Not the Near One MNDCs of any sort are going to be difficult to implement, solving some problems but causing new ones. An MNDC across the BRICs (or even MERCOSUR) is complete fantasy, given the vast disparities of ambitions, control and other factors. Not to mention, one of the BRICs – Russia – is under heavy sanctions. It’s doubtful that India or China would commit to a currency association under these conditions when they wish to remain integrated into the worlds main financial systems. CBDCs solve some of the problems, and within each country would vastly ease transactions, clearing, and avoid the pitfalls of MNDCs lack of autonomy and control. But they do not solve the problems associated with trans-border transactions. 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…
