Financial Technology

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Bringing eBAM a Step Closer The prospects for electronic bank account management are excellent Ė so itís no surprise that the market is beginning to wake up to the vast potential it can offer.

Bringing eBAM a Step Closer

by Stephan Vandewiele, Head of Global Client Service & Implementation, GTS, RBS 

With current developments in technology progressing rapidly, it’s clear that many of the more complex end-to-end processes between large corporate clients and their banking providers – such as those that require manual administration or the exchange of hard-copy documentation – will be carried out electronically in the near future. The prospects for electronic bank account management (eBAM) are excellent – so it’s no surprise that the market is beginning to wake up to the vast potential it can offer.

A multinational organisation is by its nature often a conglomerate that is spread across a series of territories, countries and legal jurisdictions. As a result, its employees may be operating many different electronic systems, with a multitude of banking relationships that encompass hundreds of accounts and a diverse range of processes, none of which may have much in common.

There is great potential in a banking solution that provides a consistent and aligned electronic framework that can be used across a number of corporate relationships.

The company may have expanded through mergers and acquisitions or grown organically but it is often the case in such large organisations that there are process inefficiencies, including the extensive processes required to open accounts from multiple locations worldwide. As a result, there is great potential in a banking solution that provides a consistent and aligned electronic framework that can be used across a number of corporate relationships. In addition, the provision of solutions that cut paper processes out and provide a fully electronic solution allows corporates to cut costs, reduce manual data entry errors, maintain control and simplify their approval management.

At present, many of the processes that corporates follow regularly – such as account opening, maintenance and closing – often involve some degree of offline processing or hard copy verification. This can be time-consuming, labour-intensive and inefficient. It can also add to costs significantly and it can be a challenge to identify where savings can be made without compromising accuracy or control. eBAM is designed to standardise the way in which these processes are carried out across the marketplace in order to deliver strong productivity and efficiency gains, eliminate paper processing and reduce the end-to-end time involved.

Beyond improved straight-through processing (STP) and traceability, the advantages of eBAM for both corporate clients and banks lie in reduced data entry – with lower risk due to less manual keying – and increased automation that will help to reduce the time required for processing requests. It’s likely that standardised control processes will also lead to better compliance with audit requirements.

Achieving eBAM

Although the benefits of eBAM are clear, to an extent the market is still defining the steps that need to be followed in order to achieve them. Not all banks are at the same stage in their recognition of and approach to eBAM, but within RBS we believe that it is well-placed to become the standard for the exchange of non-financial messages through secure communications channels, such as SWIFT – the financial messaging provider for more than 9,700 financial institutions and corporations in 209 countries – and EBICS (Electronic Banking Internet Communication Standard). In addition, eBAM is well-positioned as an enabler for STP by transforming corporate client instructions into direct back-office updates after an instruction is signed using a digital signature. In our opinion, eBAM has great potential both as a proprietary bank owned channel and as a bank-agnostic eBAM XML standard – with the decision on which solution to use depending upon each individual corporate’s banking relationships and structure.

Our existing Online Client Service (OCS) - an integrated part of our Access Online banking portal – already offers a powerful springboard into efficient account management processes. With the ability to open an account online anywhere in our network, clients can remain up-to-date on accounts and service requests, and view real-time balance and transaction information on accounts. Once an account opening request is submitted, corporates are able to download from OCS all required account opening documentation, which is automatically searched for and generated in the RBS requirements database. They can also submit service requests online and take advantage of online status and history information – regardless of the channel originally used to submit the request – and receive auto alerts when there is an update. We anticipate that OCS will feature heavily as we take the next step towards the full digitisation of processes.

In support of eBAM development, we have also been involved with the definition of the ISO 20022-certified XML standard for account management-related messages and we are a member of the Corporate Advisory Board that consists of SWIFT, banks and corporates (and aims to keep the standard aligned with the actual needs of corporate clients and banks). It appears that across the wider market, there is broad agreement that there will be some form of change. However, the form that these changes will take will differ for different corporates and be dependent upon the number of banking relationships held. Another factor that will influence how a corporate is exposed to eBAM is the way its banking partner has decided to develop eBAM capabilities. 

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