Making Treasury Extraordinary: ZEE’s Superstar Transformation

To support annual growth of more than 20%, Zee Entertainment Enterprises (ZEE) needed a treasury function that was automated, efficient, and future-proofed. Here, Rohit Kumar Gupta, CFO, ZEE and Rupa Balsekar, Managing Director & Head Transaction Banking, BNP Paribas India, explain how a bespoke end-to-end cash management solution provided by the bank has transformed ZEE’s treasury function into a digital and sustainable role model.

A global media and entertainment conglomerate with a presence across television broadcasting, movies, music, live entertainment and digital platforms, ZEE provides content to more than 1.3 billion people in 173 countries worldwide. Already a leader in the traditional television entertainment industry in India, ZEE’s vision is to become the number one digital entertainment provider in the country, through its new ZEE5 offering, and to be the world’s leading media company from the emerging markets.

As Gupta explains: “As a corporation, we are driven by innovation and creativity. Our motto is ‘Extraordinary Together’ – and our focus is on growth, while delivering exceptional value to our customers, viewers and stakeholders. From a finance and treasury perspective, that means we need to act as enablers of business growth, allowing the company to stay at the cutting edge of evolution in the industry. We need to have the right technology and funding in place to support the business and its dynamic needs. In addition, treasury must reduce any financial barriers for creators and providers of content to enable them to do the best possible job.”

Against the backdrop of a rapidly growing organisation – in excess of 20% per year – and a relatively lean finance function, Gupta knew that processes needed to be automated and streamlined to enable treasury to do more with less. With this in mind, he turned to long-term banking partner, BNP Paribas, for support in transforming ZEE’s treasury function. “Both ZEE and BNP Paribas have a passion for digitisation and automation, so our goals were, and are, very much aligned. This made BNP Paribas the natural choice of partner for our transformation journey – we also knew that they would come to the table with innovative ideas and solutions,” Gupta notes.

Echoing this, Balsekar says: “As a bank, we have to constantly reinvent ourselves in order to deliver for clients, whether that be supporting them to battle macroeconomic headwinds or assisting them in going paperless. To do this, we adopt a three-pillar approach: digitisation, optimisation and risk mitigation. And this is precisely how we have helped ZEE to become a pioneer of digital and sustainable treasury in India.”

Embracing digital collections

Starting with digitisation, Balsekar explains: “The media industry is predominantly paper-based when it comes to banking in India. Our bespoke end-to-end cash management solution is unique as it has been able to help ZEE seamlessly transition to electronic banking with no disruption to their growing business.”

Delving into the detail of the solution, Gupta says: “There were several key areas we wanted to streamline digitise, with collections and payments top of the list. On the collections side, we not only wanted to accelerate the collections cycle in order to reduce our Days Sales Outstanding (DSO), we also wanted improved data around our collections and increased visibility over incoming cash flows.” One of the challenges ZEE faced here was the large number of counterparties, as well as their diversity. Money comes into the organisation from a variety of sources: large multinationals, advertisers, advertising agencies, smaller companies and private individuals. This means that multiple channels are often used and it can be hard to have complete visibility.

“We have therefore worked with BNP Paribas to put in place a uniform reporting mechanism with direct integration of reporting through host to host. This along with faster cheque collections and several digital collections has enhanced treasury operations ,” says Gupta. Cheques are collected from the offices of ZEE’s various business units and the information about the credit that will be applied to their account is passed on to ZEE Treasury immediately. “We know exactly when the credit will be applied, and we have early sight over incoming funds – this is extremely powerful from a forecasting perspective,” he notes.

Balsekar adds that leveraging on Cheque Truncation Systems (CTS), the bank has also worked with ZEE to implement defined credit terms for cheques so that, where possible, the credit can be applied faster. Moreover, treasury no longer has to key all of the cheque information into their systems, since the information is pushed through host-to-host and automatically uploaded to the company’s ERP – freeing up treasury personnel to concentrate on more value-added tasks.

Balsekar adds that as our partnership with ZEE evolves, we are preparing ourselves to deepen the use of technology aided solutions like virtual account based e-collections or integration through APIs. “An easy-to-implement solution, virtual accounts boost collection efficiency, with immediate impacts on treasury’s performance,” she notes. “Virtual accounts offer 100% identification of the payer and the ability to automate the reconciliations process, leading to a reduction in processing time and costs as well as lower DSO and improved visibility over the performance of each business unit – since funds are automatically applied to the correct entity.”

Going green

On the payments side, almost all of ZEE’s outgoing transactions have now been digitised, including payroll and statutory payments, via BNP Paribas’ online banking platform. Not only has this led to significant time and visibility benefits, there have been important sustainability benefits too. “Corporate social responsibility is a huge focus for ZEE,” Gupta comments.

“We run a ‘ZEE Is Green’ initiative that is focused on developing the next generation of production practices that put people and profits in sync with the planet. Through this initiative, we aspire to translate our environmental commitment into action. We also ensure this green ethic runs across all of our business units and departments, including treasury. Being able to take significant amounts of paper out of treasury workflows is a win-win – we increase productivity and automation, but we also reduce our carbon footprint,” he says.

As well as helping ZEE to go green, BNP Paribas has been working closely with the company on monitoring red flags, or business risks. As Balsekar explains: “The opportunities of digitisation are significant, but you also have to be cognisant of the risks. Directing workflows through digital channels will inevitably require additional controls around cybersecurity.”

To assist here, BNP Paribas has rolled out a payments surveillance solution that actively monitors all of ZEE’s outgoing flows and analyses them against historical payments. The solution flags any significant changes in behaviour, such as larger-than-normal amounts or different bank account details, and creates an alert in a pop-up window. Treasury can then review the payment and either proceed if the information is correct, or stop the payment if it is potentially fraudulent.

“We have also provided ZEE with training modules on cyber-fraud. These contain information on the latest global threats as well as case studies that highlight potential pitfalls and additional checks that can be put in place internally to help tackle cybercrime,” says Balsekar.

Dreaming big

Reflecting on the progress his treasury team has made since he joined the company just over a year ago, Gupta is justifiably proud. “Thanks to the hard work of our employees and the partnership approach taken by BNP Paribas, we have seen significant improvements in automation and digitisation, leading to greater speed and accuracy. We also have much clearer insight into cash flows and our Shared Service Centre benefits from precise management information that is broken down by business units. In turn, treasury is now able to concentrate on helping the business reach its goals of digital growth and sustainable leadership.”

The partnership between ZEE and BNP Paribas will continue to flourish and Balsekar has already earmarked paperless exports and imports as a key focus area for the months ahead. This is particularly critical in India, since the Indian rupee is a restricted currency and cross-border remittances have traditionally involved significant amounts of paper. Elsewhere, the bank will continue to help ZEE with last-mile digitisation, and layer that with further analytics capabilities and risk mitigation solutions – thereby embodying ZEE’s motto: ‘Extraordinary Together’.