The Clearing House - Corporate Changes in Payment Practices - September 2023

BNY Mellon Unveils Cash Management Solution for Treasury Services Clients

BNY Mellon

BNY Mellon has unveiled its new cash management solution, called Virtual Account-Based Solutions.

This offering aims to provide clients with enhanced access and control over their cash administration activities and reporting capabilities, the bank said in a Monday (Jan. 29) press release.

The Virtual Account-Based Solutions provided by BNY Mellon use virtual accounts linked to physical accounts within the bank, according to the release. These virtual accounts enable real-time reflection of incoming and outgoing payments, maintaining a virtual sub-ledger that offers continuously updated transaction and balance history.

One of the key advantages of virtual accounts is the flexibility they offer clients, the release said. Instead of opening multiple physical accounts with different banks, clients can now reflect their desired account structures through virtual accounts.

BNY Mellon’s Virtual Account-Based solutions cater to various industry use cases, according to the press release. They enable the automatic reconciliation of high volumes of incoming payments over USD wires and ACH networks, accurate identification of payment remitters, and reconciliation of receivables by client, business, invoice and more.

The solutions also support the centralization of payment and collection functions across legal entities, the release said. They support Payments on Behalf Of (POBO), Collections on Behalf Of (COBO) and In-House Bank structures.

Additionally, the solutions allow for the establishment of a hierarchy of virtual accounts exclusive to specific business units, properties, divisions, geographies or purposes, per the release. This provides a segregated view of cash and transactions without the need to manage a large number of physical bank accounts.

The solutions also offer advantages to financial institution clients, according to the release. By segregating physical Nostro accounts, these clients can utilize them for their end corporate clients to receive wires or ACH credits in the U.S.

PYMNTS Intelligence has found that 54% of chief financial officers cite liquidity and cash management as a top challenge. These decision-makers need real-time visibility and control over a growing array of banking accounts, as well as powerful tools that can help them make projections, according to the “Corporate Cash Management Playbook,” a PYMNTS collaboration with Red Hat, Infosys Finacle and Intel.

In another recent product launch, BNY Mellon said in October that it launched a White Labeling service for its LiquidityDirect platform, enabling financial institutions to offer their clients liquidity management solutions.

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