Huge cost savings for ASGC after treasury digitalisation

The challenge

As an influential and leading company in the Middle East’s construction industry, ASGC’s 25 holding companies manage over 21,000 transactions monthly across 15 banks and eight different currencies. ASGC’s goal was to digitalise and centralise treasury with the ancillary goal of being more green and going paperless.

Key issues to be addressed included multiple bank portal management that created inefficiencies such as too much time spent logging into different solutions. With close to 300,000 transactions in eight different currencies per year across 15 different banking portals, this was proving tedious.

Paper cheques for payments with even more supporting documentation was proving especially difficult to manage and added exorbitant costs to the payment and transaction management process. With large amounts of human intervention in the payment process, there was also concern about potential security risks.

More broadly, the need to cater for aggressive expansion plans meant ASGC needed to get ahead of the growing pains around bank account management and increased transactions.

The solution

According to Elias Choufi, Head of Treasury, ASGC Group, “Security, speed of implementation, expertise and efficiency” were the key criteria for selecting a treasury management solution (TMS) partner to help him realise his vision. Key elements of that vision and resulting solution include:

• Digitisation around payment processing and transaction management through a single control point for all payments and centralised visibility of cash position and transactions.
• “Paperless” payments by moving from paper cheques to electronic payments.
• Leveraging new TMS technology – the solution selected was an on-demand TMS that allows for:
  • Quicker time to go live in order to reduce traditional bandwidth drain and resource consumption typically associated with traditional cloud or on-premise treasury management solutions.
  • Ability to scale functionality as the company grows without having to incur exorbitant costs for future add-on module implementations.
  • Automated the bank connectivity process; thereby reducing time and effort spent on these tasks during traditional projects.

Best practice and innovation

In line with best practice and due diligence requirements, Choufi and his team embarked upon an intensive search for a treasury management solution that could help realise his strategy to digitise, automate and centralise the corporate treasury function.

“Since we execute and manage so many transactions locally and overseas, we wanted to find a way for our team and stakeholders to have better visibility into our payments across all our currencies, entities and banks,” says Choufi. “It is also an excellent way to go paperless. Having the ability to move from paper to electronic banking transactions was a major focus of our digitisation strategy via a centralised treasury model. This also contributes to our environmental practices at ASGC.”

Key benefits

The fully digital treasury solution was live and fully integrated with its banks and ERP solution within one month. It has already generated “millions of dollars in cost-savings” by reducing manual effort from two to three days of payment processing to two hours.

Additionally, the elimination of printed cheques and supporting documentation has reduced the previously significant expenses of paper – another significant contributor to the ROI of the project.