Reval: Treasury Technology Insights for the Future
Posted: 1 February 2017 | Source: Reval
As the new year begins, finance professionals are taking stock of 2016 to better understand what they need to do in the year ahead. Given the regulatory developments around IFRS 9 or US section 385 over the past year and the continued market volatility caused by black swan events such as Brexit and uncertainty, the anticipation of change in 2017 is building. For many financial professionals, the ability to adapt to change in the market and in their business now requires new or better automation. In a recent interview with Bobsguide, Reval Chief Technology Officer Philip Pettinato offered his outlook on the role treasury technology will play in future.
Do you believe that treasury is truly being innovative in 2016?
Philip Pettinato, Chief Technology Officer, Reval: Innovation, while really a relative term, generally means coming up with a better way of doing something you do now. In that respect, I think many companies are turning to treasury technology to help them better manage treasury and risk.
Companies that are creating a global technology platform are, in essence, laying the foundation for further innovation. We are seeing new implementations of in-house banking structures, enabled in the cloud, which will help them optimise their resources internally and externally in ways they couldn’t before. This cloud-based foundation is enabling treasury organisations to respond nimbly to regulatory pressures, market events and growth, spending time on analysis that is actionable rather than on gathering data that is out of date by the time they complete the task.
Will there ever be a future in which treasurers do not use spreadsheets for cash management?
Spreadsheets are a valuable tool to analyse data – they are not a processing platform, especially not the kind of platform global treasury organisations need. Many treasuries are using spreadsheets for operational tasks, but spreadsheets were not designed for this. They don’t provide the right controls and are not the source of data, which people turn them into; they are just for retrieval and analysis of already integrated data.
Has the cloud revolution ended, or has the excitement moved on to another technology?
The hype has ended, but not the revolution. Cloud has definitely gone through its hype cycle, where there are now many different applications of cloud technology that are proven to add tremendous value.
So, it is not so much whether people are moving onto the cloud, but what new technology will evolve out of the cloud itself that will enable value, efficiency, and more capabilities as businesses use it over time. For example, mobile couldn’t happen without cloud. Treasury right now is in the process of replacing legacy systems with cloud-based technology. There is a paradigm shift in treasury technology every 15 years, so I would say this is the beginning phase of that shift to the cloud for treasury.
Is blockchain still a mystery to treasury?
I can see the value in applications such commodity trading or even currency exposure netting – where people are sharing a chain of transactions, like moving physical commodities – but the jury is still out on whether it is the right technology to support these types of applications.
Although innovation with blockchain is advancing, I believe it is some ways off in treasury.
What are your predictions for the future?
Software is becoming simpler and easier to use. It is increasingly taking care of the detailed work while users spend their time gaining insight and taking action. This is especially the case in treasury as companies become players on the global stage, participating in M&A, responding to developments that continuously effect the markets.
Treasuries are turning to the technology that will progress as they progress, helping them better manage transactions, measure risk and respond to volatile and dynamic markets and new regulations. In both our consumer and our business lives, the proliferation of data from the Internet of Things will continue to drive technology innovation. We will need new ways to make sense of that data to add value to our lives. Technologies that add true value are always the winners.