How Treasury Management Strategies Can Improve Your Cash Flow
March 18, 2022
A balanced approach to liquidity can help your business stay resilient and flexible — attributes that are valuable in any economic climate. Smart treasury management strategies can take your business there.
An engaged relationship banker should proactively work with you to tailor your individual plan to improve cash flow, considering efficiency in payables, receivables and information reporting. Sophisticated digital solutions can simplify these processes and allow treasury managers to conduct business anywhere, any time, on any device.
Handling complex vendor payments efficiently and reliably can be a resource drain for growing businesses. In a recent panel interview with Payments Journal, industry leaders noted that the need for efficiency has been underscored as teams increasingly work remotely. In response, more business owners are now opting for digital solutions that automate the entire accounts payables process.
Depending on your business requirements, your banker might recommend these strategies:
Integrated payables consolidate payment instructions from multiple channels into one automated procedure.
Same-day ACH payment origination enables you to send payments and control cash flow quickly and securely — ideal for small transactions that are more time-sensitive than traditional ACH payments.
Commercial credit cards automate payments, simplify invoice reporting and effectively provide a “float” of 25-30 days.
Tools that speed up the deposit of funds received help put your money to work for you as quickly as possible. A remote deposit capture system expedites fund collection by scanning checks and electronically depositing them into your bank account. The FDIC has reported that more businesses have moved to remote deposit capture in recent years.
Depending on your business, you might also benefit from ACH debit origination, mobile deposit, or flexible point-of-sale merchant service solutions — all designed to save time and money in your AR process.
Information reporting and managing liquidity
Evolving digital technologies are making it easier to keep tabs on your cash position so you can make intelligent and timely decisions for your business. For example, applications like mobile and paperless banking, which include convenient reporting features, have become standard for many companies.
Products using Applications Programming Interface (API) technology are also becoming the norm in many industries. APIs enable systems to communicate with each other for the seamless, real-time experiences consumers and businesses expect (think Uber and apps that track a package’s delivery minute by minute). Business owners can take advantage of products using API infrastructure to deliver current balance and transaction reporting, in real time, from their bank account directly into their company’s accounting system.
Blockchain technology for payables and receivables
One of the most exciting possibilities for companies that make or accept B2B payments is blockchain-based digital payments solutions. For example, our bank is now among the first to offer business clients a blockchain platform for making and receiving real-time, regulatory-compliant digital payments. You may wish to find out if your bank has plans to offer a blockchain-based payments capability that adds 24/7/365 convenience, not to mention heightened security, to the mix.