In an executive interview with Treasury Management International, Dieter Stynen, Global Transaction Banking FX at Deutsche Bank discusses some of the challenges and opportunities for cross-currency payments and collections.
In terms of challenges, Stynen explained that when converting currencies there is often no visibility over the FX rate that is applied, making it difficult to monitor FX costs that are often uncompetitive. In theory, treasurers can avoid this by opening accounts in each currency, but this can result in fragmented liquidity and additional administration cost. Stynen noted that companies, therefore, are trying to reduce the number of bank accounts, particularly as administrative overheads are becoming more onerous as banks’ regulatory compliance requirements continue to grow.
Stynen added that Deutsche Bank are helping clients address this challenge through their cross-currency payment and collection solution, FX4CashTM. This allows treasurers and finance managers to pay or receive more than 120 currencies through a single account. Steynen noted that FX4Cash is available through Deutsche Bank’s regular current accounts: there are no new accounts required, and no changes to electronic banking, host-to-host or other communication channels.
FX4Cash is seeing highest demand in companies that are building their international supply chain, across both customers and suppliers. FX4Cash enables them to do this very effectively, without the need to extend their cash management infrastructure or establish new bank relationships or accounts.
To read the full interview, please click here.