FinTech collaboration in payments and cash management delivers better results for banks and corporates alike: Let’s work together?
“Together we stand, divided we fall,
Come on now people, let's get on the ball and work together,
Come on, come on let's work together, now now people,
Because together we will stand, every boy and every girl and man…”
…go the lyrics of an obscure 1962 Wilbert Harrison R&B number, wise words to a song subsequently covered by numerous artists. Ironically, I last heard it (the 1970 Canned Heat version I think), driving back from a disappointing client meeting, having bid to provide cash management services to a multi-national corporate and come second. Gresham is a treasury specialist FinTech with, we like to think, the best banking integration and straightforward payments and cash management solutions in the business. What we don’t pretend to have, or aspire to have, are the sophisticated capabilities of a good Treasury Management System. We lost the bid to a TMS vendor that did, but also claimed to be able to do what we do. I met the group treasurer of that client a couple of years later and learned that the bid-winning TMS vendor had been unable to connect to banks as effectively as promised. A TMS starved of fundamental information, such as accurate cash balances and payments reconciliation references that reception of detailed and timely bank statements through automated bank connectivity brings, leaves a corporate treasurer exposed and does not offer value for money. In this case, all that money had been spent (I naturally enquired whether we could come back and deploy our solution after all, but was told the budget was now gone!). So…
- The client was unhappy because the TMS hadn’t lived up to its promise,
- The TMS vendor was unhappy because the client was unhappy,
- I was unhappy because our solution was perfect for the client,
- Everyone was unhappy.
On the flip side, a more enlightened TMS vendor contacted us recently. They had a client bid underway, there was complex automated banking integration required, and the TMS vendor understood that it lacked the skills to implement this cost-effectively. The client also needed a cash management portal immediately, and deployment time for the full TMS was six months. So, rather than try to retain every last cent of revenue for itself by offering services it couldn’t easily provide, this TMS vendor collaborated with us and we won the bid. Sadly, such collaborations are rare, with most vendors preferring to work alone, reluctantly linking to third-party platforms only at the behest of their clients. My experience is that larger banks are far more conducive to helping clients by partnering with a FinTech. Surely the big banks aren’t more flexible than the FinTech’s?
With initiatives like Open Banking and real-time payments schemes promising to change the corporate cash and treasury landscape, collaboration between FinTech’s to provide end-to-end services has never been more important. Let’s work together!