Cash Management - A Journey From The Traditional To The Smart Digital!

Cash Management – A Journey From The Traditional To The Smart Digital!

In today’s age of digitalization, the once-popular modes of cash & cheques are slowly ceasing to remain the primary instruments that businesses in India use for their transactions. Till now, cash management has been a cumbersome activity which required a representative of the organization to physically transport the cash and cheques to the banks, join the queues and get the money deposited into the account. But with growing awareness and use of digital money, banks are evolving from the traditional silo-based cash counters to web-based services making way for digital cash management.
Progressive banks with focus on customer delight have already hopped on the mobile bandwagon, offering customers with apps designed to do banking on the go. According to a report compiled by PwC, 77% of financial institutions have increased their internal efforts to innovate, with many businesses embracing the disruptive nature of FinTech [1].With the availability of so much technology around, many businesses are looking for banks offering an enterprise-wide solution for their organization. This has led to banks partnering with technology service providers who can simplify their digital cash management system and contribute in addressing their challenges.

What Does Cash Management Mean Today?

Every business has a multitude of cash inflows and outflows that require management, in order to meet payment obligations, plan for future payments, and maintain adequate business stability. It’s all about making sure that your cash is optimally utilized and is directed to the right place at the right time.
Many Corporates and SMEs look to their bank to manage their cash on their behalf.  It includes basic account management such as cheque and cash deposits, savings, liabilities, and payments. Digital Cash Management, as a service, is provided by almost all the major banks and even the minor banks using outsourcing. With time, the role of banks has evolved from being a mere financial mediator in all transactions to trusted technology partners.

 How Will Technology Impact Cash Management in Banks

Now that the entire banking world is shifting to self-service models, banks are heavily investing their money into a banking software, which is easy to use, dependent, and is fortified with advanced security features. A big emphasis is given to cash management which involves high volume transactions from different accounts. The Digital transaction banking sector is estimated to generate big revenue in the days to come. Since smaller banks and organizations are growing in strength, their rising asset size forecasts a steep growth in cash management.
Through the cash management solutions at Mindgate, there is a proactive and insightful way to handle the working capital. E-collect by Mindgate is a platform that enables banks to interact with diverse corporate business systems, simultaneously integrating all the bank payment and receivable digital channels with core banking. It provides a holistic Collection and receivable management alongside  a cluster of new-age banking solutions such as Real Time Payments and Utility Bill payments. Our products can help corporates execute collections through automated workflows along with comprehensive reporting services, comprising standard and customized reports. The Virtual Account (VA) feature of e-collect facilitates payments and collections through a single account using POBO/ COBO (Payment on behalf of/ Collection on behalf of). The benefits of POBO COBO includes:

  • Greater Transparency: A centralized and real-time overview enables management at head office to track company-wide cash flows and ensure compliance.
  • Lower Risk Of Fraud: Regular surveillance of receivables and collections of local entities thus mitigating fraud risk of corporates.
  • Monitoring Local Subsidiaries: Centralized and standardized processes can help monitor local payments by providing direct feedback to local entities.
  • Optimizing Payment: POBO assures of a payment lifecycle that guarantees optimized and cost-efficient payment methods.

If you are looking for a reliable technology partner who can develop a centralized digital cash management solution for you, please contact Mindgate for the most advanced collection & payment solutions.
1. How technology is impacting the finance and banking sector