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Hosted TMS Enables Smaller Companies to Enhance Treasury Operations at a Lower Cost
Blog on Controller's Report, Financial Leadership, Internet & IT Costs • posted 01/03/12
Most small companies expect a Treasury Management System to improve efficiency by providing relief from the burden of manual operations, help them to reduce staff, provide value added services like pre-defined interfaces to banks, hotlines for processing issues, and improved cash flow forecasting. However, in-house systems typically require a financial investment not all can afford. They also require trained users, IT support and extra staff to get the most out of them and, therefore, most small firm users end up using only a small fraction of their TMS capabilities. As a result, hosted solutions have become an obvious fit for smaller companies and are growing rapidly in popularity. A recent 2011 study from Treasury Management Systems reports some 44 percent of TMS solutions are now delivered on a software-as-a-service (SaaS) basis. Spending $500,000 for an in-house TMS system may be a non-starter for most budget discussions these days, according to most experts, making the substantially cheaper SaaS approach an easy choice.
Advantages and Providers of Hosted Solutions
There are three basic advantages to a hosted system – technical, cost and value added services. With a hosted solution you avoid all the technical headaches like training your own in-house IT specialists, or creating your own backup systems and disaster recovery sites. In terms of costs, there is little or no upfront investment in TMS hardware, operating systems and database software. And, SaaS gives you access to a variety of value-added services like pre-defined bank interfaces, back office processing, integrated dealing platforms, SWIFT connectivity and electronic bank account management (eBAM).
There are now at least twenty-two TMS solutions on the market (see list below). New solutions, such as Kyriba, TGold and Reval, are available only as hosted solutions. Vendors of some of the more traditional in-house TMS, like SunGuard and Wall Street Systems, are also now selling hosted solutions.
Typically, companies with just one cash management bank and limited need for other activities, will use the cash management portal offered by the bank. Bank portals provide very basic cash position worksheet functionality that requires keying of data. But when a company has a global, multi-bank environment that includes cash flow forecasting, reconciliation, cash pooling and intercompany lending, a TMS is usually adopted.
Currently available TMS solutions include:
- Allmybanks.net
- ATOM
- AvantGuard Treasury
- FinanceSuite Treasury Management
- Findur
- Finlogik
- FTI STAR
- GTreasury WebCash
- Integrated Treasury System ITS
- IT2
- Kondor Trade Processing (KTP)
- MX.3
- Parity TMS for Windows
- qPayIntegrator
- TGold
- tm5
- Salmon Treasurer
- SmartTreasury
- Wallstreet City Financials
- Wallstreet Suite
- Wallstreet Treasura
- Wallstreet Treasury SaaS
Source: Treasury Management Systems
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