What are the benefits of using a treasury management system under PSD2? (2024)

What are the benefits of using a treasury management system under PSD2?

Payment Components have been providing treasury management solutions to corporations for several years and have served many clients needs worldwide.

And we have found corporations who are starting to consider a treasury management system will naturally, first ask; what are the benefits of using a treasury management system?

So we thought it would be helpful if we provided an article that sets out the key benefits of using a single treasury management system as opposed to a corporation's current multiple systems.

7 Tangible benefits of using a treasury management system

We've managed to narrow the selection down to "The Magnificent 7" Benefits of a TMS and we've created an infographic, providing a quick & visual summary...

7 Benefits of a Treasury Management System (TMS) from Payment Components:

1. Time Efficiency

Using a treasury management system will streamline your payment process, minimizing the time spent on authorization and the initiation of payments.

With Single Sign On instead of multiple Web Banking logins – thanks to PSD2 - you save precious time on a daily basis. A Streamlined & distributed authorization process further minimize the time spent & eradicates organizational bottlenecks . Finally the ability to automate & schedule payments initiation, means you no longer have to be present in front of your PC for a payment to take place...

2. Reduce Costs

The clarity & complete information & insights offered by a TMS, allow you to immediately detect the cost of expensive cross bank transactions. The additional tools offered to automate routing rules & the flexibility to use multiple bank accounts, provide you with the perfect tool-set to Minimize cross bank transactions and their related fees.

3. Reduce Errors

By mapping your corporate processes and digitizing your workflow processes accordingly you remove the "guesswork" and directly minimize the potential for human errors. A modern TMS offers the ability to enforce multiple authorization points & automate the routing rules - eliminating two, key causes of errors, in payments processing.

4. Full and accurate Audit Control

The digitization, enforcement & logging of “4 eyes” (or even "6 eyes" in some cases) authorization process generates a Complete, Detailed & Accurate audit trail within a single system. There's always a complete register of all actions pertaining to a specific payment. This is not limited to the Treasury but includes a full log of the TMS communications with the banks.

5. Detailed & Actionable Insights

The TMS serves as an Aggregated & Consolidated Analysis & Reporting platform. Thus it provides actionable Insights to discover inefficiencies and optimization opportunities, such as cross banks payments, historic cash flow & balances volumes etc.

6. Bank provider flexibility

Your TMS acts as a single interface / bridge to multiple banks & accounts. This in conjunction with the PSD2 APIs and the emergence of global Financial Messaging Standards (such as SWIFT, SEPA, ISO20022), means that you now have the option to switch bank providers, without affecting your daily productivity & workflow. Remember using a TMS means that you’re no longer reliant on a specific bank’s web interface!

7. Compliance & System standardisation

By adopting a Treasury Management System you also implicitly Standardize Processes & Systems. Your team can now be trained in a single system meaning quicker on-boarding times. In addition to that you establish your organization as fully compliant for the emergence of global & regional Financial Messaging Standards such as SWIFT, SEPA, ISO20022.

Conclusion

As you can probably see, there are many benefits to using a treasurymanagement system for your corporation’s treasury needs. And with PSD2 being live now, the CFOs dream for account aggregation can now become true.

See how our UNUapi helps treasury management systems make this a reality