Cash shortages can indicate a huge problem in companies. Cash is the lifeblood of a company, and running out of it prevents you from meeting your financial responsibilities. Whether it is an early-stage startup or a Fortune 500 enterprise, managing cash flow is a vital component to an organization’s success.
Executing optimal daily cash management is a discipline that relies heavily on several business units and departments throughout an organization. When money moves at a high volume and a high scale, the complexity of managing it increases. It can be daunting for businesses to have to track hundreds of thousands of payments, at various times, using different payment types that settle at different speeds. There are a lot of moving parts and considerable room for error.
The goal is to offer corporations with real-time visibility. They should be able to ensure that they are getting the most up-to-date picture of how the cash is moving in and out of an account, as well as who is making a certain transaction so that the cash flow situation can be understood, liquidity can be improved, and overall financial profitability can be increased.
Accurate cash flow forecasting is critical to daily cash management, but is plagued with roadblocks in terms of the speed and quality of the gathering of the required data. Though spreadsheets are considered the norm in finance and treasury, they are by no means scalable when your business grows. They inevitably lead to mistakes and errors when you need to combine data from many systems, subsidiaries, banks, and contributors. It's no surprise that 83% of CFOs & treasurers claim that their company needs better forecasting and understanding of its cash positions.
New industry developments, such as the acceleration of payment processing with features such as instant payments and faster payments, have put an additional strain on the urgency of cash visibility for optimal reconciliation. Real-time cashflows necessitates real-time cash management, which can get more complicated when cross-border payments and currency fluctuations are factored in.
Sancode technologies has helped organizations optimally manage their cash and enhance their visibility therein, with a scalable cash management solution.
A cloud-based cash management platform can interface effortlessly with all banks, ERPs, and independent market data sources to process several files eliminating the need to manually download data from portals.
Without requiring any manual interaction, RPA can auto-reconcile transactions using standard and user-defined rules. Automated bank statement processing and reconciliation saves time, eliminates errors and allows cash managers to focus on higher-value duties. Automated cash management analyzes cash in motion, deposited cash, and the level of capital reserves to ensure that a company is financially healthy.
AI enabled engines can provide daily analytical insights into the corporation’s liquidity and foresight to its future monetary position by stress-testing multiple scenarios easily. They can automate modeling scenarios across numerous cash flow categories, regions, and currencies which can also enable them to track deviations, trends, and irregularities more precisely and improve their forecasting accuracy.