Some corporate treasurers have been slow to take advantage of automation when it comes to foreign exchange trades, instead relying on older, manual systems. "By condensing into minutes a process that may take hours to complete, digitization also saves treasurers time that can be better used in more profitable tasks," writes Bloomberg's Tod Van Name.
Partnerships between payment startups and legacy companies are benefiting companies and enabling a range of advantages, from streamlining accounting to gleaning insights from payment data. Troves of payment data are also targets for hackers.
Small enterprises that sell business-to-business face the risk of a cash crunch due to unpaid receivables. "The risk can be devastating, especially if you have a lot of concentration," said Sebastian Rymarz, chief business officer for Fundbox. Fintech that enables an efficient way for small businesses to assess and extend credit could help mitigate risk.
Manufacturers can free up capital for mergers and acquisitions, training and other projects by using supply chain finance principles to improve the cash conversion cycle, writes Tom Roberts of PrimeRevenue. The manufacturer Hillenbrand, by going through a supply chain finance exercise, was able to free working capital and improve its stock price, he writes.
Economic indicators have been mixed, suggesting a recession is less imminent than many economists think, says Charles Mulford, an accounting professor at Georgia Tech. He notes a widening spread between short- and long-term interest rates of government securities and the Federal Reserve's recent statements on rate increases.
The Organization for Economic Cooperation and Development is spotlighting more than $4 trillion in corporate debt globally that will need to be refinanced or repaid over the next three years. That number is a big part of the $13 trillion in worldwide debt that has piled up since the financial crisis, a total more than double the comparable number before the 2008 crash.
Digital transformation takes different forms and scope depending on the industry and the organization's needs, writes Sandra Beckwith, who shares examples from midsize companies in four industries. Manufacturer NFI has shifted to digital printing, which enables connectivity between sites, higher-margin work and a new approach to sales and marketing.
The use of artificial intelligence in finance is an evolving area underpinned by decades of research. AI technology could further automate the selection of securities, right-sizing risk based on such factors as the client's age, health and financial situation.
Bank of America Merrill Lynch's Global Transaction Services (GTS) business provides comprehensive global treasury solutions across the breadth of the working capital cycle, including liquidity management, payments and receipts, commercial card, foreign exchange and trade and supply chain finance. With a history spanning more than 230 years, GTS services thousands of clients - small businesses, mid-size companies, large corporations, financial institutions and public sector entities - in more than 200 countries and 140 currencies.