Leading in Digital Cash Management

For many years, cash management was an ancillary function for corporate treasurers, and in some cases, the same applied to banks. No longer. As corporations in all industries review and transform their business models for a digital age, and new payment and collection methods emerge, managing cash effectively has become a strategic priority to improve margins, enhance the customer experience and support global liquidity needs. In this environment, working with a strategic partner such as DBS that is pioneering innovative solutions in cash management across key Asian markets, is a vital way to address pain points, leverage new commercial opportunities, offer a seamless customer experience, and create competitive advantage.


Digitisation and the customer experience

Regardless of the industry a company operates in, creating a seamless experience for customers has become fundamental to delivering growth and competitive advantage. To achieve this, corporations of all sizes and profiles are seeking to digitise and automate their processes and customer interactions from end-to-end. For example, companies that previously sold through distributors or agents, whether business-to-business (B2B) or business-to-consumer (B2C), are increasingly selling direct to customers through e-commerce models.

As a first step, this involves setting up new digital sales channels and the means to collect payments. However, a successful e-commerce model with a high level of customer satisfaction also relies on immediate fulfilment of goods and services. To achieve this, companies need to be able to identify and reconcile incoming flows immediately, and integrate this data instantly into internal systems to trigger the dispatch of goods or authorise access to services. In many cases, companies also need to be able to manage a fast-growing volume of collections as subscription-based models, online media services such as pay TV, and digital payments for transport, insurance and other services become more prevalent.

Enablers of transformation

Real-time payments and innovative technologies are amongst the key enablers of transformation and digitisation of traditional business models. Real-time or instant payments schemes offer instant movement of cash, but also 24/7 processing, negating the concept of business hours and creating both challenge and opportunity in the way that corporations construct their business models. At the same time, new technologies are transforming the exchange of transactions and data, and the way in which data can be harnessed, including the use of open application programming interfaces (APIs) combined with sophisticated data analytics, artificial intelligence (AI) and machine learning (ML).

As a result of these developments, alongside wider industry developments such as the growing use of mobile wallets and industry disruption as new players and business models emerge, the concept of cash management is changing dramatically.

“While payments and collections were ancillary to the core business in the past, today they are pivotal to digital business models, driving supply chains and fuelling ecosystems.”
Jasmin Ng, Group Head of Cash Product Management, DBS

Consequently, banks can no longer sell products and services in isolation, but must understand their customers’ business in depth and deliver solutions that integrate data and transactions across the ecosystem in real-time, 24/7. This requires a fundamental change of approach, moving from traditional banking to digital banking, and from discrete products to integrated ecosystems.

Client-centric innovation at DBS

“As a bank, we pride ourselves as being the bank for a digital age, and a first mover in the use of new technologies to transform our clients’ experience of banking, address treasury and cash management problems and create new commercial opportunities.”
Jasmin Ng, Group Head of Cash Product Management, DBS

DBS is one of the first banks in Asia to use API-enabled banking with our clients, with an initial suite of over 100 APIs which continues to grow. Through the use of APIs, DBS enables the seamless integration of banking services into clients’ business platforms and processes for improved productivity and workflow efficiency. For example, DBS has worked with regulators in Asia to digitise tax payments, partnered with ERP and accounting system providers to integrate transactions and information flows, and co-created digital payment and collection solutions for clients and their end customers.

”Our approach to digital, integrated banking is wholly client-centred, reflecting every client’s diverse needs and expectations of innovation. In some cases, clients come to us seeking new ways to resolve specific pain points, such as identification and reconciliation of incoming flows, payments or process efficiency. Others are looking to understand what new opportunities are emerging and the value that these could offer to their business.”
Jasmin Ng, Group Head of Cash Product Management, DBS

For instance, a large number of organisations in Singapore are seeking solutions to leverage the new Singapore Quick Response (SGQR) code, the world’s first unified QR code offering. SGQR was first introduced in September 2018, and allows buyers to scan a single QR code to make payment across any one of 27 payment schemes, such as PayNow, Nets, credit/ debit cards or e-wallets, rather than having to find the specific QR code that relates to their payment scheme. The convenience and simplicity of the unified QR code approach has led to an explosion in the use of QR code-initiated digital payments. Companies with online businesses or mobile applications in particular can benefit from using QR codes as a mode of payments/collection, as this in turn provides a seamless and instant transaction experience for its customers to pay without using physical cash or card, while not compromising payment security. One example where DBS has enabled an organisation to do this is its partnership with Singapore Airlines (SIA). With the use of PayNow QR codes, SIA enables passengers to pay for their flights direct from their bank accounts using PayNow, and issue tickets once payment is completed. In the event that the trip is cancelled/amended, SIA can refund the outstanding amount back to the passenger’s bank account directly and automatically. Benefits accrue to both passengers and SIA: passengers benefit from secure, convenient payment, while SIA can identify and reconcile incoming flows easily, and manage refunds efficiently.

As awareness and adoption of QR codes continues to increase, corporations operating in a wide range of of industries, particularly fast-moving consumer goods (FMCG), media, retail and other B2C industries, are seeking to understand and implement ways to leverage the opportunities that QR codes offer.

Accelerating innovation and reducing risk

Whether clients consider innovation to be a way of solving problems or creating new opportunities, the most successful innovations are those that are most deeply embedded into their processes, system environment, business model and strategy.

“To achieve this, we co-create with clients leveraging our ‘4D’ innovation process: discover; define; develop and deliver. By taking a structured approach to innovation, we can accelerate the innovation process and reduce project risk, whilst ensuring that new solutions achieve project objectives in a precise, integrated way.”
Jasmin Ng, Group Head of Cash Product Management, DBS

An example of 4D innovation is the way that DBS has worked with large insurance companies to digitise claims processing in Singapore and Hong Kong, transforming the customer experience whilst also streamlining internal processes and reducing costs. While in the past, it could take days or weeks to process claims, DBS has enabled insurance companies to accelerate claims processing and replace manual cheques with instant payments direct to claimants using bank account instructions held in a central, government repository. In other cases, DBS has worked closely with ride-hailing platform companies to streamline and digitise both payments from customers and payments to drivers.

In doing so, we have helped to enhance the experience of every participant in the value chain, reducing costs and improving financial and operational efficiency and satisfaction levels from end-to-end.

Resetting industry norms and expectations

The impact of these innovations is not simply to enhance the experience of individual corporations, but also to set new expectations and establish new norms for the industries in which these organisations operate. However, fulfilling this transformative role requires more than technology innovation alone. A bank also needs to demonstrate a proven ability to deliver new technology solutions, a commitment to client partnership and co-creation, a structured innovation process, and the expertise to understand and positively contribute to client needs and aspirations.

In addition, the cash management landscape is changing rapidly with significant disruption as new payment services providers and fintech companies enter this space.

“At DBS, we embrace this change and disruption and recognise our role as the connectivity hub in clients’ ecosystems, facilitating the flow of transactions and data between ecosystem participants. This role continues to evolve as new payment methods and business models emerge, transactions and data are increasingly exchanged in real-time and client expectations on service models develop, such as interaction using augmented reality. It is important for us to continue to innovate and invest in the right skills and experience to support our clients through this new digital cash management landscape.”
Jasmin Ng, Group Head of Cash Product Management, DBS

While cash management is likely to be radically different in ten years’ time compared to today, banks with a long-standing commitment to cash management, alongside their third-party technology and infrastructure partners, will be catalysts, enablers and long-term partners to accompany clients through their transformation journey.

The information herein is published by DBS Bank Ltd. (“DBS Bank”) and is for information only. 

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