Treasury Management Internation Logo
Cash & Liquidity Management
Published  8 MIN READ

Automating Transactional FX: Unlocking Efficiencies and Growth Opportunities

Prior to the coronavirus crisis, few corporates had thoroughly reviewed the way they processed their foreign currency payments. But with remote working and rapid digitisation, treasurers are starting to explore the benefits of automating their transactional foreign exchange (FX) workflows. Sat Khuntia, Head of FX Sales, Barclays Corporate, and Daniela Eder, Head of Payments & Cash Management Europe, Barclays, examine the ways in which the FX payments ecosystem is evolving and outline a range of digital tools that could assist treasurers in the post-Covid-19 world.

There’s an old adage that says, “don’t fix something if it isn’t broken”. And many corporates had taken this attitude towards their transactional FX workflows, until the pandemic hit. Before the crisis, transactions were agreed with counterparties, spot FX deals were made, and cross-border payments were initiated. Transactional FX was simply part of business as usual – and, often, little thought was given to the potential for operational efficiencies and strategic gains by improving these workflows.

The turning point came when treasury practitioners across the globe began working from home and currency volatility skyrocketed. As Khuntia explains: “When the world went into lockdown, treasury staff were faced with the reality of making FX-related payments, dealing with foreign currency receipts, and managing the company’s working capital in multiple currencies, via remote channels. Initially, many struggled to access the necessary systems from home and the amount of manual work involved in transactional FX workflows was highlighted.”

Treasury leaders soon began to question the validity of such a manual approach in a world that was shifting rapidly towards digital and automated solutions. “The inherent risks involved in manual FX processes also became apparent – and the crisis has provided a huge incentive for treasurers to take greater control of risks, maximise operational efficiencies and unlock growth opportunities,” he continues.