Web-based treasury management: now that it's here, what does it mean to you? (Selected Topics).

The introduction of Internet treasury management systems has been one the most important events to take place in the world of corporate banking. Cash management services are typically offered by banks to corporate customers to enable them to manage cash flow and related treasury activities. The Internet allows financial institutions and their business customers to conduct these financial transactions with a high level of ease and efficiency.

The goal of the financial institution is to migrate clients to its web platform. Running multiple platforms is expensive, and banks are spending the lion's share of the money on improving their web environments. Consequently, this is where the customer will see the most improvement and creativity in convenience and services. Obviously, there are many benefits to the corporate client if it moves to web-based banking services. Among these benefits are improved workflow efficiency, access to real-time information, and sharing data with multiple users in multiple locations.

There are three objectives involved in a financial institution's introduction of web-enabled services. The first is to build an Internet presence by moving existing DOS and Windows functionality to the web. The movement of applications to the web is ongoing; most financial institutions are currently in some stage of web-enabling their existing services. For instance, one bank may provide information reporting products, but not payments. Another may have ACH, but no wire. And some may already be starting to move beyond these basics to positive pay and other treasury services.

Next, the bank must add incentives to its web site in order to attract visitors. Potential corporate customers can be drawn to the web site through portals featuring news feeds, stock tickers and other financial services, as well as new banking services. Even non-banking services, such as business travel information and links to sources for office supplies, have proven effective in attracting visitors to a financial institution's web site.

Finally, with so many new web clients to support, the financial institution must maximize its efficiency in setting up these customers and servicing them. The industry's web-based banking efforts have proven extremely successful, and financial institutions have attained large numbers of new clients. As many as half of these are new to electronic corporate banking altogether, while the rest are migrating from Windows- or DOS-based systems.

The Internet has increased opportunities and eliminated obstacles for financial institutions seeking to address the industry conditions described above. For instance, with web-based treasury management there is no software to distribute or proprietary communications to support. The bank is able to focus its attention on the product rather than its delivery--it returns to being a service business, instead of a software distribution business.

If a financial institution is focused on product development, it is possible for it to compete and better position itself against competitors in the market by improving its services and expanding its depth and breadth. With the need for software distribution eliminated and the Internet's universal accessibility, a financial institution can plan on reaching larger numbers of customers.