The global treasury-management market, in which banks help corporate clients with cash management, trade finance and global payments, is huge and lacks good self-service tools and automated processing. And this is leaving a wide open opportunity among such large financial competitors as Visa Inc. and U.S. Bancorp’s Syncada payments network, JP Morgan Chase & Co. and Bank of America Corp. to provide advanced treasury technology to corporate chief financial officers and treasury departments.
U.S. Bank estimates the international corporate-payments market represents $67 trillion in yearly payables. More than half of that amount is still paid via paper check, according to Forrester Research.
HSBC, which is selling its credit card portfolio and cutting back in other areas of the institution (
The service connects to a couple of SAP products: SAP Bank Communication Management, a payment-tracking application; and SAP NetWeaver platform, SAP’s overall application environment. It also includes a preconfigured Swift component designed to improve access to the Swift network.
NetWeaver is services-oriented and uses C++ and Java EE programming languages as well as open standards that allow it to interoperate with Microsoft, .NET, and IBM Websphere, which many companies used. The integration designed to ease the flow of digital payments between HSBC’s corporate clients and those clients’ other bank partners in the payment-supply chain.
“At the moment we are concentrating on getting the basics right, starting with payment processing,” says Marcus Treacher, HSBC head of e-commerce for global transaction banking. “Once we have proved that this connectivity works, we will extend the HSBC Connect to SAP offering to include trade finance, the remaining treasury services and regulatory reporting.”
HSBC offers payment collection, foreign exchange and other corporate financial transactions through a single pipe via HSBCnet.com or through a single connection via HSBC Connect, Treacher says. By reengineering HSBC Connect to embed it within SAP, the bank hopes to make it easier for corporations to access digital financial services, helping HSBC expand those relationships.
“This offering provides the corporate treasurer with efficiency gains by automating manual processes,” Treacher says. “It also provides better and more timely visibility over cash positions.”
And by basing the service on open standards, HSBC hopes to lower the cost of ownership for corporate clients, which presumably would have less technology infrastructure to manage because of the reduced integration with the payment systems of other banks and business partners.
Corporate clients also could reduce the manual keying of transaction and registration data for their own clients. “The onboarding is much speedier. A corporate can go into play with a single bat,” Treacher says.
Many of HSBC’s competitors have taken similar steps.
Syncada, for example, has pushed for standardized invoice processing, while American Express Co.’ platform allows corporate clients to maintain existing workflow processes. Citigroup’s cross-border payment service uses a single invoice for vendor invoices and other transactions.
Citi also is a participant in the Syncada network, as is Elavon and Commerce Bank of Missouri.
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