The Association of Financial Professionals lives up to its name. That was my lasting impression of last week’s AFP conference in Philadelphia. I knew the organization focused on the education and career paths of their members, but the amount of people packing sessions that contributed to accreditation and education was truly impressive.
You know how most conferences are one-way communications? The exhibitors talk to the attendees and no one talks back? Not here. Attendees were very curious, asking a lot of probing questions of panelists. Among those questions and concerns: FedNow, real-time payments, ISO 20022, payments fraud and insider fraud. I also sensed several different business trends. Here’s a few of them:
E-invoicing: It is of course part and parcel of AP/AR automation, and now it seems to be getting a close-up. Chatter on the show floor reflected it as well as a few sessions. Basically, e-invoicing digitizes AP data and allows for better reconciliation across all departments. By going digital on invoices its easier to match them against contracts, purchase orders and receipts. It also guards against inaccurate data and provides better defense against AP fraud than analog methods. At Bottomline we refer to it as invoice automation. The unique value prop (in addition to the aforementioned features) is that it allows for streamlined approval even when a wrench is seemingly thrown into the process. To that end it creates an easier way to have necessary conversations within the solution. It also incorporates internal messaging features that allow approvers and other key stakeholders to collaborate within an invoice record, preventing that end-of-process slowdown described above.
From Philly to Minneapolis: I spoke with a gentleman from The Minneapolis Fed who told me they were taking a very aggressive stance in promoting e-invoicing. There’s a white paper on their site, which is definitely worth checking out. It shows that Europe is in various stages of e-invoice adoption, with Nordic countries having the highest adoption rate compared to the rest of the region. The Minneapolis Fed expect 95% of all invoices to be automated within two years. It is also part of the Business Payments Coalition, which is largely made up of private sector companies advocating for automated invoicing.
AFP Report: This generated a lot of show floor chatter. They recently released their Strategic Role of Treasury survey report for this year, which indicates that treasury practitioners rank cash management and forecasting as a high priority at their organizations. I asked Celent’s head of corporate banking Patricia Hines if she thought commercial banks that serve them are in synch with this and offering appropriate solutions? Here’s her answer:
“If anything, the current uncertainty of the economic climate is increasing the importance of cash management and forecasting. Add in the plethora of new real-time payments systems and corporate treasuries and finance departments have more methods than ever for sending and receiving funds, all impacting cashflow. From a bank perspective, the development of cash forecasting solutions is a logical extension of traditional information reporting capabilities. Essentially, this takes the basics of a day-to-day cash position and forecasts the balances 7, 30, 60 or more days into the future. If banks can deliver it, cash forecasting can provide a significant value-add to clients, and a competitive edge in the progression toward more sophisticated treasury solutions. Of course, to be of value to a treasury client, a cash forecast shouldn’t just be a straight-line projection calculated in an Excel spreadsheet.”
Outloook 2023: She wouldn’t play all her cards because Celent is preparing its 2023 outlook, but Hines also told me she’s watching embedding next generation client servicing into the digital channel, enabling embedded finance by integrating bank data and processes into ERP and TMS systems, and going beyond forecasting towards AI-powered intelligent applications.