If you take a quick look around you, it is likely that a smartphone or tablet computer won’t be far away. The evolving habits of today’s consumers and corporates mean that expectations for mobile applications to be available anytime and anywhere are increasingly commonplace. But how comfortable are treasurers with mobile channels and how committed are their banks to investment in mobile technologies?
Developments that offer great potential to increase the productivity and improve the flexibility of the treasury function are normally welcomed with open arms. And mobile technology should be no exception, especially in this day and age. “With increased travel commitments and the need to fulfil multiple roles, the ability to manage their company’s transactions – amongst other functions – on a mobile device is going to be invaluable to corporate treasurers,” explains Marie-Caroline Domingo, Head of Client Access for Global Transaction Banking in Asia Pacific, Deutsche Bank.
But mobile technology has thus far had somewhat of a mixed reception from treasurers, which many put down to its novelty and intangibility. Completing banking transactions and associated activities on mobile devices in the corporate world is “a relatively new phenomenon for treasurers,” explains Ankit Goel, Treasury Manager at Bharti Airtel.
This is in stark contrast to the general consumer uptake for mobile banking – which has been impressive, with solutions on offer from all of the major retail banks. These are typically used to complete payments and authorise transfers of small amounts.
In the business world, however, “corporates are dealing with transactions of significant value so a lot of reassurances with respect to security are required,” Goel explains. The result: developments aimed at corporates are inevitably, albeit appropriately, slower.
The relatively slow adoption of mobile services in the treasury function has not been helped by the lack of available services from banks. Aite Group reported in September 2014 that 63% of global banks are yet to offer corporate mobile banking. “Traditionally, corporate banks have underinvested in digital technology,” says Thomas Zink, Research Manager for IDC Financial Insights. But now that is starting to change.
Deutsche’s Domingo explains how her team have taken time to gather feedback from clients which has been vital in shaping the bank’s mobile developments. “We have adopted a relatively conservative stance in rolling out mobile services because we wanted to ensure, from direct feedback, that any development addressed a problem for our corporate clients and created real efficiency for them.”
Unlike desktop computers, mobile devices can bridge a gap created when access to fixed infrastructure is not possible – which is not an uncommon challenge among Asia’s emerging economies. Thankfully, the processing power of tablet computers and smartphones is further increasing and high-speed internet connections continue to improve across Asia. The benefits of which, according to Nidugondi, can be of assistance to consumers at either end of the development spectrum experienced in Asia.
For example, when traditional bricks and mortar banks aren’t financially feasible, how do you reach potential clients that require access to the organised banking services? “For the unbanked or underbanked in emerging markets, you can use innovative mobile methods to reach isolated areas and address the needs of this segment.” Bank representatives from Bank of South Pacific are using tablets to sign up consumers and businesses to financial services in rural areas of Papua New Guinea, for example. Users can then transfer funds and make payments using their mobile phones.
However, as frequently seen in the region, the great disparity between individual nations is problematic for mobile innovation. For instance, Bharti Group’s Goel explains that “Indian banking is highly regulated by Reserve Bank of India; hence major banks are still to come up with mobile banking solutions. It is the MNCs and private Indian banks that have started to offer solutions.”
Based on the different infrastructure and maturity levels of each market, solutions can take different forms but, regardless of the target end-user, “the reality is that, in addition to electronic banking regulation, there are also local outsourcing and local data privacy requirements to comply with,” explains Tony McLauglin, Regional Cash Product Head for Asia Pacific at Citi. Going live with a mobile solution is dependent on compliance and “it’s something we go through market by market.”
Similarly, Arafat Sheik Jabbar, Head of CitiDirect Asia Pacific at Citi, explains that by continuously gathering user feedback, Citi has been able to optimise the intuitiveness of their corporate mobile solutions. And, the smart choice in taking time to advance is paying off. According to Srinivas Nidugondi, Head of Mobile Financial Solutions for Mahindra Comviva, “mindsets are changing and corporates are quite excited. Aside from mobile payment solutions being a ‘current’ thing to talk about, a lot of them are beginning to see benefits in this overall way of doing transactions as well.” Sheik Jabbar cites the delivery of time-critical information – such as access to balance information, status updates and alerts – remotely and on demand as an example of how mobile solutions are helping treasurers make informed decisions whilst on-the-go. “Additionally, treasurers are able to translate financial data into global business intelligence with just few taps on their tablet, viewing data globally, by region or country and filter by currency, amount, country in map or chart views.”
Initially, corporate mobile applications were largely informative, providing notifications for the end-user but newer solutions are becoming more interactive and action-orientated. “In Asia, we have seen an increase of functionality being added to the mobile platform,” says Citi’s McLauglin.
Solutions on the move
As corporate treasurers grow more comfortable with mobile channels, and the services on offer undergo development, the desire to perform more sophisticated treasury-related tasks via the medium of mobile is increasing. For example, Aite Group’s survey of 45 corporate treasurers in May 2014 revealed that 51% of respondents ranked approving wire payments as ‘important/critical’ and 46% believed initiating wire payments would be ‘nice to have’. According to Zink, “changing corporate client preferences – looking for fast fully-integrated solutions, lean processes, 24/7 access via the web and mobile devices – goes hand in hand with the evolving role of treasurers in modern enterprises.” Treasurers are more accountable for the regulatory compliance and cash positions of their organisations and management ultimately relies on their insights to make the right decisions at the right times.
The treasurer’s traditional role also requires more effective payments mechanisms and accurate cash flow forecasting. This translates into a need for an accurate, real-time and comprehensive view of the liquidity position of an organisation – increasingly on the go, Zink explains. Moreover, further “technological advances like integration with ERP, elimination of hard token login requirement, user friendly applications in a complex multi-entity and multiple accounts banking structure, productivity will definitely improve,” says Goel.
But is such productivity for everybody? For Damian Glendinning, Treasurer at Lenovo, some responsibilities certainly shouldn’t be mobile-based: “Typically, we tend to be formal about the payment approval process. Mobile suggests the tendency to do things on the move – if you’re on the tube home or waiting in a queue – and in my view, that’s not the appropriate environment.
“Payment enablement, however, is very different from passive consultation of bank accounts. If you’re waiting for confirmation of payment, for example, then this can be done in a less formal environment.” KyongSun Kong, Analyst for Asian Financial Services at Celent explains that corporates sometimes prefer face-to-face and formal interactions due to more intricate requirements.
There is some disparity in opinions but certainly, for Zink, greater data analytics and business intelligence capabilities are playing a crucial role in allowing banks to mine large amounts of data increasingly near real-time, while data visualisation and dashboarding makes data more actionable and easier to digest – particularly on mobile devices. Celent’s 2014 survey Mobile Banking in Asia indicated that growth in transaction volume is the top driver encouraging banks to enhance their corporate mobile banking capability.
Perhaps the largest barrier to adoption remains concerns over security. There is a degree of resistance towards the idea of allowing corporates access to networks over mobile devices. However, the perception that mobile technology is inferior regarding security is reducing as users become better informed. “The same security that exists in the desktop world also exists in the mobile and tablet world,” explains McLauglin. Information is carried using the same bandwidth and, with the exception that a mobile device does not have a fixed IP address, security measures are applied in largely the same way.
As corporate treasurers grow more comfortable with mobile channels, and the services on offer undergo development, the desire to perform more sophisticated treasury-related tasks via the medium of mobile is increasing.
There is an aspect of joint responsibility where, as Goel explains, “it is important that banks create awareness among the corporates about the security features, data transmission capabilities and authentication mechanisms” but mobile security also depends on the user being receptive to education on safe computing and internet practices. For Nidugondi, “users need to be careful: the weakest link is usually the human. It is a case of educating the user – this is where I believe the adoption curve has been a little slow.”
Against this backdrop, creating a suitable mobile treasury dashboard or application for corporates inevitably involves a balance between convenience and security. The most frequent solution to achieving this balance is ensuring the levels of security change depending on what the user wants to do. “For example, the user could view a report without a process of authentication but to view balances one level of authentication would be required. To complete a transaction, identification via a touch ID or transaction pin would be necessary,” explains Nidugondi.
In Domingo’s experience, corporate clients generally understand the security mechanisms that have to be in place, accepting the trade-off in terms of what security procedures are required for certain activities. But security should not compromise the user experience. Indeed, collaborative efforts between corporates and solution providers are increasingly commonplace in creating user-friendly yet secure applications. “The key driver behind corporate mobile banking services is the client. Certainly market requirements are putting pressure on banks to deliver increasingly innovative solutions as well but the client’s user-experience is driving developments,” says Domingo.
“You can have all the bells and whistles but if the user experience is bad, then it’s not going to work,” says Nidugondi when describing his own frustration as a user filling in a mobile app registration that required his country code once, only to be asked for the same information again at a later stage. After all, treasury departments are staffed by consumers, and their experience of technology in their personal lives can influence the technology they do or do not introduce into the corporate treasury.
At Deutsche Bank, Domingo explains, they benchmark themselves against what their clients perceive to be a good user experience. “What we know is that client preferences are becoming more and more influenced by the use of online tools outside of the banking industry – social media applications or search engines – and clients are expecting the same ease of use and convenience for their banking applications.”
Tapping into success
Despite certain barriers to the adoption of mobile technology, most believe “the future of mobile banking is bright and strong,” explains Goel.
However, it remains uncertain whether everyone will be willing to adjust their working habits in accordance with mobile developments. The convenience factor, for Glendinning, is limited to general office expenses (such as ordering pizzas to a meeting or arranging for flowers to be delivered) where mobile-enabled credit card accounts are encouraged.
Simply judging by the percentage of corporates still relying solely on desktop methods, persuading them to become avid mobile users could take longer than the banks expect. However, adoption of mobile treasury is predicted to “increase and intensify”, says Zink but “corporate mobile banking is rather characterised by slow evolution than by revolution.”
Arguably, the APAC region is progressively digital, gradually adopting mobile solutions for ubiquitous access to treasury tools. And as technology matures, processing power increases, and data integration deepens, the value for corporates will increase. The true added-value, however, will always come from the skilled corporate treasurer. Ultimately, it is up to them to decide whether and how mobile channels will influence their strategic decision-making going forward.