Best In-House Bank Solution - WINNER
Sanofi
A global leader in immunology healthcare, Sanofi partnered with BNP Paribas to revolutionise its Cash Management processes through a tailored virtual account solution. This cutting-edge collections-on-behalf-of (COBO) structure, combined with multi-currency capabilities, aims to centralise collections in foreign currencies for numerous legal entities, optimising foreign currency liquidity management. This award-winning solution will replace numerous physical accounts with a streamlined system, significantly improving cash visibility, reducing manual interventions, and enhancing operational efficiency.
Centralising Cash management for a multinational such as Sanofi is no small feat. With payments flowing in across currencies and continents, the company needed a smarter way to manage its collections.
Collaborating closely with banking partner, BNP Paribas, Sanofi implemented a multi-currency virtual account solution. Sanofi can now manage collections centralisation across various currencies through one virtual account, eliminating the need for foreign currency accounts at affiliate level when combined with POBO (payment-on-behalf-of), simplifying operations and improving efficiency on a global scale – an achievement any treasurer would approve of.
Adding smart touches
A dynamic matching table has been introduced as part of the solution. Such an intelligent matching table automatically allocates virtual account references based on Sanofi’s criteria, enriching statements with custom client references for seamless ERP reconciliation.
Enriched virtual account statements provide detailed information on payment flows, supporting more informed financial reporting and analysis.
Further innovation has been incorporated in the form of a virtual sweep functionality. This feature streamlines intracompany postings within Sanofi’s in-house bank (IHB), automating transactions for efficient cash position management.
Collaborative innovation
Sanofi engaged High Radius, the provider of the company’s cash application module, to collaborate on the project. This partnership ensured seamless integration and operational consistency. This effort met Sanofi’s immediate needs and established a scalable framework for future growth.
Driving measurable results
The implementation of this solution is expected to deliver transformative results:
- Improved cash visibility and control through consolidated collections
- Enhanced customer credit management via automated cash applications and reconciliations
- Significant cost savings and productivity gains by reducing manual interventions and errors
- Closure of affiliate bank accounts, allowing for greater focus on strategic decision-making
Future Outlook
Following a successful MVP and initial implementation, Sanofi aims to expand the solution in 2025. The company intends to include more legal entities and customers in the COBO structure.
This pioneering project showcases the power of innovation and collaboration in transforming treasury operations. By addressing complex collections challenges with a flexible, scalable solution, Sanofi has set a new standard for virtual account usage in corporate treasury management.
The system’s flexibility allows for easy adjustments, such as to accommodate additional currencies, legal entities, or customers, as the company evolves.
Such initiative shown by Sanofi has rightly seen the company claim Best In-House Bank Solution at this year’s TMI Awards.
