Photo of Abed Islam, BNP Paribas and Gloria Liu, Fameccanica Machinery (Shanghai).

This solution harnesses the expertise and technology of the company’s banking partner to deliver a scalable and robust platform to accept SWIFT standard file formats. The project was established alongside a major ERP implementation.

The challenge

With the growing business and the corresponding increased complexity, Fameccanica Group recognised the need to consolidate its electronic platforms and to establish a SAP integration to a common electronic banking platform for global payment and collections in the four countries where they operate.

China is an extremely important market for Fameccanica. Gloria Liu, China Financial Controller explains, “It was critical for the company to establish our infrastructure and processes to make us equipped to cater for this huge market and growing needs. We needed a robust and globally accessible electronic platform to improve our processes and visibility, with timely and accurate reporting.”

With many local banking relationships, multiple ERPs, multiple languages along with differing legal and regulatory jurisdictions, the company was tasked to complete the integration and implementation of SAP in 12 months. The objective was to achieve functional optimisation with minimal business interruption whilst minimising the potential high cost of SWIFT and cable fees.

The solution

Based on discussions with several banks in China, Fameccanica were given two options to consider:

• Apply for standard SWIFT service to send or receive MT files (such as MT101, MT940, MT942) for payment and reporting.
• Deploy an e-banking system from a bank and send or receive specific file format designed by that bank (such as TXT file).

These options posed different challenges for Fameccanica Group. While their ERP system could easily extract standard SWIFT files, if they were to use SWIFT for payment and reporting, the operational cost would be high. On the other hand, if they adopted an e-banking platform from a bank, the investment on the ERP and technology was likely to be high as well.

This is the first time we have won an award in this area and this is a real honour for us! The Adam Smith Award Asia is a milestone for Fameccanica’s global strategy, beyond technology and supply chain globalisation. Also this is a milestone for the Fameccanica and BNPP business partnership, as we jointly implemented the project together.

Gloria Liu, China Financial Controller, Fameccanica Machinery (Shanghai)

Additionally, there were complicated technical requirements on the back end to ensure that their payment files were aligned with the bank’s file format and requirements. They also faced the daunting challenge of integrating a standardised platform, taking into account the four countries in which they currently operate.

The chosen solution is a scalable and robust platform with highly customised configurations by BNP Paribas on its e-banking system, Connexis Cash which allows BNP Paribas China to:

• Accept the standard SWIFT MT101 file formats for payments, regardless of whether the accounts are opened with BNP Paribas or other banks.
• Accept the standard SWIFT MT940 file formats for reporting and account reconciliation regardless of whether the accounts are opened with BNP Paribas or other banks.
• Both MT101 and MT940 can be sent and/or received through a single global e-banking platform, Connexis Cash.

Best practice and innovation

Fameccanica Group was able to leverage the robust and scalable solution to accept SWIFT standard file formats through BNP Paribas’ banking platform, without incurring SWIFT-related cost or cable charges. At the same time, they are able to leverage SWIFT standards to overcome the issues related to regulation, clearing systems and languages in the different markets in which they operate.

Gloria Liu says, “According to Fameccanica’s mission “Non Stop Innovation”, working together with IT and F&A teams, leveraging the expertise of our banking partner, BNP Paribas, we have been able to build an innovative set of technical policies, processes and technology. This project creates new capabilities, improvements in operations, finance, and treasury functions to manage the business. It also allows scalability to cater for our growing businesses. With the established system in place, we are well placed to accommodate growth, without additional headcount and costs.”

Key benefits

• Increased visibility through enhanced account reconciliation and more robust reporting.
• Global standard of payment and collection is established within the group.
• Reduced cost with less IT investment requirement and improved operational efficiency.
• Scalability for future growth.

Key learning points

Do not set a limit by yourself, open your eyes to see what’s new and available, what can be utilised to improve work and life.

As the Fameccanica slogan says: Non-stop innovation!