TMS providers survive on their ability to stay in front of regulatory change: when a new regime takes place, vendors must be well placed to react.
The fintech sector is becoming a key component of treasury support thanks to fintechs specialising in niche, custom-built technology. But fintech needs to stay ahead of the game as regulatory changes come over the horizon and competition between the bigger players increases. Across the globe, governments and regulators have stepped in to encourage fintech developments – some providing seed funding, others creating sandbox initiatives to help take projects to the next step and ensure compliance.
Although there is a recognition that technology is an important enabler to meet risk management objectives, many market participants say they were looking to review their current system for a more advanced one, with a substantial number not confident that their current system would continue to support them effectively in the future. For buyers, that means closely assessing options.
Bobsguide research suggests few treasurers believe their current treasury management systems perform very well at providing regulatory reporting, behavioural assumptions, and dealing with market data stress.
In the past year, many companies have had to realign their systems to deal with key challenges including the impact of banking rules. But with many of the regulations facing the treasury department, firms are beginning to understand the benefits and opportunities to be realised with greater and more efficient adoption of technology, as a shift from traditional processes appears to be taking place.
This may be explained by the reliance on traditional methods, such as the use of spreadsheets, identified by respondents as the biggest pain point with their current treasury systems.
TMS providers have stepped in not only to help automate a range of processes, make better uses of resources, but to help with the functional and strategic requirements of the treasury function.