The complexities of corporate cash management — particularly across borders and currencies — means that a broad range of treasury and CFO functions are getting the high-tech, outsourced treatment.
That includes payments functionality, of course, where bringing payments processing “inside” the bank’s umbrella of offerings is becoming a key attraction for the banks themselves, intent on keeping corporate (and in other cases, consumer) relationships “sticky.”
For enterprises, the lure is there to streamline B2B payments, or offer preferred payments in a given market (to name one example). For those corporates that are consumer-facing, having more control of the payments experience means they can pivot quicky to changing payments preferences.
The debate that surrounds outsourcing and digital-first initiatives hinges on buy versus build as banks bring more management solutions in house — and if recent events are any indication, there’s room enough for both strategies to help achieve that goal, in effect crafting end-to-end solutions within a bank’s own platform.
To that end, this week PNC Bank said it has reached a deal to buy Tempus Technologies for an undisclosed sum. The company is a gateway payment provider that delivers payment processing solutions to businesses. Offerings include payments apps and payments portals.
In the announcement detailing the deal, PNC said the acquisition would expand the company’s Treasury Management’s payments platform — specifically by enabling corporate clients to manage payables and receivables through a single channel, spanning all payment rails.
Tempus Technologies solutions will be integrated with PNC’s existing payments platforms, such as the RTP Network, ACH, Wire Transfer and Zelle, said the company.
And in another bit of anecdotal evidence that payments processing is in the crosshairs of financial institutions (FIs) large and small, earlier this year, Texas-based Vantage Bank Texas said it deployed CGI All Payments as part of the community bank’s digital transformation. APS, according to the announcement, replaces Vantage Bank’s legacy FedWire and ACH processing solutions, as well as positions the bank for real-time payments for its customers.
The overarching trend is toward “payments as a service,” and as spotlighted in an interview with PYMNTS, Deepak Gupta, global head of PaaS at Volante Technologies, it’s a strategy that can help all stakeholders (the banks and their clients) build resiliency.
“I’m seeing that over 80 percent of our prospects are showing a strong preference for payments as a service,” he told PYMNTS of FIs, adding that “two or three years from now, 99 percent, if not 100 percent, of all customers will go the ‘cloud way’ and embrace payments as a service.”
As detailed in this space, Commerce Bank has broadened its partnership with treasury management and order-to-cash solution provider HighRadius to integrate the full HighRadius suite of integrated receivables and treasury management tools. That announcement came after a 2019 expansion in which the bank added HighRadius Virtual Card Processing and Electronic Invoice Presentment and Payment technologies.
Separately late last year, BNY Mellon announced a partnership with GTreasury. GTreasury will be directly integrated into BNY Mellon’s LiquidityDirect money market funds investment platform.
Earlier last year, Citi said it expanded the reach of its CitiDirect BE Digital Onboarding platform. Tapodyuti Bose, global head of digital channels and data at Citi TTS, told Karen Webster that amid the pandemic, the bank’s corporate clients have been moving to digital channels to interact with their end users. Though they may have centralized at least some treasury operations, said Bose, many larger firms have still been working out of fragmented ERP systems collected from several acquisitions of smaller firms.
J.P. Morgan EMEA Head of Wholesale Payments Shahrokh Moinian said in a separate interview that technological innovation is helping to unlock more opportunities for corporate treasurers to step up to this newfound strategic role in the enterprise. Treasurers not only need real-time transaction capabilities, but they also need the ability to transact “anywhere, anytime, in any network around the world.”
Moinian emphasized the importance of FIs embracing FinTech collaboration as more industry newcomers begin to target the corporate customer. He noted that for J.P. Morgan, those FinTechs offer “more of a collaborative relationship than a competitive relationship.”
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