APIs, Data Analytics Bring Cash Flow Control To The Back Office

The pandemic is causing fluctuations in the global economy, and supply and demand shifts are causing many businesses to face liquidity stresses and limited credit access. These factors are putting companies to the test, especially in how they handle their corporate finances.

There have also been shifts in how customers pay for goods and services, with social distancing policies making contactless transactions essential and pushing consumers toward payment methods such as bank transfers and digital wallets. Such touchless payment options are being used alongside traditional ones like credit cards and checks.

Integrating digital transactions across different payment channels can result in silos of information if these transactions are deployed on back-office systems that are outdated or rely on manual processes, and these issues can become worse as time passes. Such silos prevent treasurers from comprehensively analyzing and gaining insights into companies’ cash flows and expenditures, hindering organizations from operating efficiently and reacting to customers’ needs in an agile manner.

This means treasury departments must have back-office integrations that can enable them to manage payments across various channels. The Mastering Multichannel Commerce Playbook: Bringing Multichannel Optimization To The Back Office, a PYMNTS and Citi collaboration, analyzes the back-office benefits of integrating multichannel payment flows.

The playbook also explores how the pandemic has created unprecedented risks and challenges for treasury departments, which fund operations despite revenue challenges while also dealing with unpredictable supply chains. Incidentally, there is no one-size-fits-all solution to tackling these risks, as one firm’s best practices may not be as effective for another’s operations. Each company’s risk management approach must therefore be tailored to its specific business needs.

It is important for businesses looking to understand the risks treasury departments face to identify and execute best practices. Companies that have long been involved in importing or exporting goods — especially those with international operations — identify foreign exchange (FX) management to be a major source of risk, given the large fluctuations in exchange rates. Liquidity rates have become a key challenge for treasurers since the pandemic’s onset, however, as is the case for interest rate risks, FX risks, external funding, cybercrime and digital treasury transition.

Multichannel back-office payment integrations can deliver comprehensive, real-time transaction reporting, which can improve treasurers’ abilities to respond to cash flow and liquidity management challenges. Treasurers must also offer customers online access to manage their FX risks through digital channels, as the mismanagement of FX channels can lead to even more risk if customers are not proactively engaged.

To learn how financial services firms are bringing multichannel optimization to the back office and improving payment processes as well as the customer experience, download the playbook.