Digital India: A New Dawn for Treasury Management
As well as being technical experts and strategic business partners, today’s treasurers must also keep up to speed with digital innovation. This means not only understanding the role of digitisation in building a next-generation treasury function, but also recognising the importance of digital disruption in helping the wider business to grow and prosper.
With so much ‘noise’ around digital innovation, it can be difficult to filter out the trends and initiatives that truly matter. To help treasurers in India do just that, HSBC’s Global Liquidity and Cash Management business held a Digital Innovation and Transformation Forum, April 2018 in Mumbai. The Forum attracted over 100 corporate attendees and was hosted by Lance Kawaguchi, Managing Director, Global Head - Corporates, Global Liquidity and Cash Management, HSBC.
Supporting widespread digital adoption
Opening the Forum with an overview of India’s digital journey to date, Kawaguchi explained how the country is well on its way to becoming a digitally-empowered society and economy. He outlined some of the key milestones achieved since the launch of the government’s Digital India initiative in 2015, including the introduction of Umung, a unified platform that supports e-government activities, and the Smart Cities project aimed at delivering more sophisticated urban infrastructure and services.
He noted that, “While one might think that digital innovation projects such as this are happening purely at a macro level, in fact, they are taking hold at a grassroots level too, ensuring all citizens have access to a single ID for government and banking services, improving digital literacy and making internet accessible for millions of rural households.”
Inevitably, this kind of systemic change is leading to new consumer and business expectations. To support these, HSBC has invested in its digital capabilities in the country. “We’ve leveraged digital technology in the area of biometric data, making it easier for you to initiate activity on our e-banking platforms while enhancing security through touch ID, voice recognition and most recently, facial recognition,” he said.
“Furthermore, we were one of the first banks to launch the Unified Payments Interface (UPI), allowing corporates and financial institutions digital access to the massive consumer-to- business (C2B) market. We were also among the first banks to go live with e-mandates for direct debits and electronic support for Goods and Services Tax (GST) Payments,” he explained.
Kawaguchi then took a moment to address the elephant in the room: fintech. “It’s been said before, but we truly aim to see these industry disrupters as partners, rather than threats,” he reassured the audience – citing the bank’s partnership with TradeShift, a fintech focused on digitising the invoicing and supply chain process for corporates, as evidence of this.
Collaboration is the order of the day, he said, since there is no value in corporates having to ‘choose sides’ between banks and fintechs. “HSBC will continue to focus and invest in these types of partnerships going forward; to keep pace with the changing market and to best support our clients,” he noted.
Navigating the new digital landscape
Following Kawaguchi’s opening address, Pranay Mehrotra, Senior Partner, Boston Consulting Group, took to the stage to discuss how business and bank interactions are changing as a result of the evolving digital ecosystem. He began by addressing the global themes of Industry 4.0 and the digitisation of supply chains, moving on to the potential of blockchain and robotics to enhance manufacturing and deliver a better customer experience.
Homing in on the corporate treasury sphere, Mehrotra also spoke about the role of banks in providing corporates with cutting-edge digital solutions. He called out the growing advisory role of banks, such as helping treasury to better understand how to optimise the supply chain and improve working capital metrics, through the use of technology. Data analytics would also be a key area where banks and corporates could collaborate more closely in the future, he said.
Providing a counterbalance to these digital opportunities, Mehrotra also underlined one of the well-documented drawbacks of digitisation: cybercrime. He urged treasurers in India to pay closer attention to cyber threats as digital innovation continues, and to engage with their banks around cybercrime prevention.