Western Europe: Treasurers Prep For Open Banking

Vendors guide corporate clients through increasingly frictionless—though initially disorienting—new platforms.

With liquidity at the heart of a treasurer’s cash-management arsenal, the introduction of the Single Euro Payments Area and the second Payments Services Directive (PSD2) present both challenges and opportunities for banks wishing to better serve European corporate clients.

Treasurers want a user-friendly dashboard covering cash management, liquidity management, trade finance, foreign-exchange (FX) and, in particular, making it easy to follow the money. “It all has to be available on the desk of a treasurer in a very simple mode,” says Cédric Derras, global head of cash management at UniCredit. “They want more traceability of payments, full transparency on how they are processed and where the cash is—and in whatever currency.” It also, he adds, has to be “super secure.”

Security and speed, the two key trends in the market, are not very compatible. “You need real-time antifraud measures on top of real-time end-to-end customer solutions,” Derras explains. “Banks need to show security of operations, but at the same time show speed of execution, which is quite a challenge.”

It’s tough to stay on top of all relevant developments. Lothar Meenen, global head of corporate cash-management sales at Deutsche Bank, wonders if all the use cases of PSD2, a “potential game-changer,” are fully appreciated by treasurers. “There are potential opportunities for treasurers too,” he says. “For example, using APIs [application programming interfaces] to enable the aggregation of multibank data for businesses that do not have the budget for SWIFT for Corporates.” He sees banking-and-payments innovations providing an opportunity to build the treasury of tomorrow: “As open banking matures over the next 12 to 18 months, forward-thinking corporates will be able to realize significant cost efficiencies or even unlock new revenue streams.”

The paradigm of open banking is, according to Derras, an opportunity for banks to become aggregators of information gleaned from customer activity and—in partnership with third parties—to invent aggregation-based services. “PSD2 and open banking may allow us to develop cash-pooling solutions, which may be cross-bank and cross-border.” He thinks this might benefit small to medium-sized companies, which are generally late to embrace cross-border cash-pooling solutions.

Brexit has made FX volatility a concern, particularly for smaller companies, who will seek advice from banks on how to manage risk. So the possibility of offering them new liquidity-management solutions is an enticing one.

Virtual accounts have made a real difference in treasury-management simplification.

“Cash-pooling infrastructures are very much simplified by using virtual accounts, so the liquidity-management standpoint becomes more simplified and gives treasurers better control,” states Derras. “Both payments and transaction-banking activity are in a complete transformation mode due to regulations, technology and the trends and behavior of our clients. We must continue to enhance our existing solutions that are working well today, but continue testing new technologies and solutions with consortiums, with other banks and with fintechs. By always testing in a financial ecosystem that includes banks, clients, regulators and fintechs, together we are constructing the future by transforming transaction banking … I believe it will be completely different in the future.”

Western Europe

Best Overall Bank for Cash Management

Société Générale

Best Bank for Liquidity Management


Best Bank for Payments and Collections

Deutsche Bank

Best Provider of Short-Term Investments/Money Market Funds

Deutsche Asset Management

Best Bank for Working Capital Optimization