Given the persistently low-margin environment of today, where interest-based revenue remains minimal, transaction banks have to innovate and adopt an advisory approach to increase reliance on transactional fees. Regional corporations and financial institutions are increasingly expanding their businesses outside of Asia, causing the increasing fragmentation of supply chains and offshore sourcing in the age of globalisation. There is a need for more efficient and seamless solutions offering payments delivery in a wider range of locations, and enabling access and management of real-time information associated with these payments. Supply chain solutions have thus evolved and become the irrefutable trend. This emergence has necessitated transaction banking solutions to be created on the same platform as internet-based products, developed to cater to the basic needs of settling purchase of goods, with intra-day visibility of cash flows.

According to The Asian Banker’s Annual FI Cash Management and Trade Finance Satisfaction Report, where participant banks were asked about key emerging themes in cash management, responses ranged from multichannel banking, renminbi (Rmb) internationalisation to supply chain management. This is held in conjunction with the assessment of the annual transaction banking awards which consist of cash management, trade finance and currency clearing. We reviewed 40 applications and found that Deutsche Bank’s Autobahn App Market boasts a capacity to increase collaboration across product lines without compromising on the customisation and integration of an institution’s technological platform, concurrently adapting to the ever-changing demands of clients, without additional costs. In the satisfaction survey conducted, Deutsche Bank was ranked as one of the top banks for its cash management services and value-added products.

Speaking on how the bank differentiates itself from its rivals, Satvinder Singh, global head of trust, securities services and cash management for financial institutions at Deutsche Bank, said “Our technology strategy is in fact very clear: we look at what our clients need, and what we anticipate the market will do and respond ahead to offer our clients the added advantage. We believe that innovation is driven at the bank-end of simplicity.”

In the current context, where silos are consistently being consolidated while business units are defined by ambiguity, products trend towards a holistic and consultative approach. Clients now seek better visibility of their working capital positions, streamlined accounts receivables and accounts payables on a regional basis. We found that Deutsche Bank had the ability to help clients re-engineer processes related to their accounts receivables and accounts payables to achieve a higher degree of straight-through-processing (STP), reducing the risks caused by human errors.

With uncertainty over the global economy hampering growth, effective risk management remains at the top of treasurers’ agenda. While businesses increasingly use multiple currencies through transactions with their counterparties, economic and transaction risks have to be minimised. At the same time, financial institutional clients seek revenue enhancement opportunities, a multi-currency solution such as the likes of FX4Cash, which endows both corporate and financial institutional clients with operational efficiency while retaining control over foreign exchange rates amidst differing jurisdictions and regulations.

Besides having a global presence, transaction banks need to provide financial Institutional clients with customised multicurrency products. Deutsche Bank’s FX products are almost unrivalled. The Asia Accelerator, intended to maximise clients’ access to timely payments and liquidity for both the US dollar and Euro, allows Asia-bound payments to be prioritised ahead of others. Coupled with VEP (Very Early Payments) and DCT (Direct Customer Transfers), clients are able to commit to their clients on payment processing time. Such products are crucial when fast turnaround time, together with accurate and concise responses, are expected by clients. Being the largest Euro clearing bank and one of the non-US banks to clear large volumes of US dollar and listed as the third largest sender of USD payments on the CHIPS network, Deutsche is dedicated to executing clients’ payments with accuracy and efficiency. This is evident as Deutsche Bank was awarded the Best Euro Clearing Bank in Asia Pacific by The Asian Banker for three consecutive years. While internationalisation of the Rmb has seen banks channel efforts to offer Rmb-denominated services, Deutsche Bank took a step ahead to achieve global interoperability. It is the first global bank with a STP connection to China’s CNAPS clearing system and an established cooperation with the People’s Bank of China (PBoC).

Transaction banks’ ability to remain competitive in the sustained low yield environment will depend on their flexibility to innovate and conform to the needs of their clients. Besides addressing product requirements such as regional connectivity, liquidity optimisation and risk minimisation, transaction banks will be well-advised to take a more consultative approach – being more of a relationship-based strategic partner than a mere provider. In addition, the importance of a dedicated on-the-ground customer service team covering specific areas such as investigations of the payment status, offer our FI clients a distinctive advantage over the general market practice of call centres.