The challenge

With 12 outlets in Malaysia, biscuit company Ban Heang needed better account visibility for its cash positions, specifically on incoming and outgoing cash. Being a family-run business since it was founded 22 years ago, payments via cheque were the preferred option, rather than online payments. However, the cheque payment method was tedious and ineffective, especially when many payments have to be made to various recipients.

A more effective and secure method was required for Ban Heang’s outlets’ deposits, particularly because the 12 outlets receive a sizeable amount of cash collection from its customers on a daily basis. Not only was it a cumbersome task to arrange delivery of the collected cash to the bank for depositing, it posed a real security risk, due to the large amounts of cash involved.

In addition to this, Ban Heang’s collections were sitting idly in its account without earning any interest, and this represented a loss in interest of around US$2,400 per year.

The solution

Ban Heang selected United Overseas Bank Malaysia (UOBM) as a partner to find a customised solution which covered all aspects of the company’s cash management requirements – receivables, payables and liquidity management. Combining multiple facets of cash management, Ban Heang and UOBM worked together to agree on a complete solution via the bank’s web-based cash management system, Business Internet Banking Plus.

For cash management, CashSafe was selected to facilitate cash collection of close to US$3.6m from the 12 outlets. This entails the installation of an intelligent commercial cash deposit machine, placed in an outlet’s premises. Depositors use an assigned card to deposit cash in the machine, before being provided with a detailed receipt. Outlets can view all deposit activities in real-time via a web-based terminal management system.

Best practice and innovation

The relationship between Ban Heang and UOBM was one of close cooperation. Working together to better understand the business requirements, the solution was customised in accordance with the specific cash management needs. With CashSafe, Ban Heang has been able to improve productivity almost overnight, as outlets no longer need staff members to count the deposited notes. Instead, staff channel their time towards more essential business activities.

Cash flow has also improved, since all monies deposited before 12am are credited into the accounts the following day, instead of sitting idle. Additionally, the outlets have a real-time and detailed view of all deposit activity, allowing for optimal cash flow planning. The ability to see where the company’s cash is at any given moment is a real boon, as it has greatly alleviated the risks associated with staff having to carry large sums of money to the bank for depositing. As the business no longer requires cash in transit, incurring cash holding insurance expense, it has delivered even greater cost savings.

Key benefits

In addition to the benefits provided by CashSafe, Ban Heang’s payables are streamlined with online banking, reducing the administrative effort of performing the transactions manually. Other benefits include:

• Greater accessibility to accounts in real-time.
• Desired visibility and control can be customised based on Ban Heang’s management structure.
• Easy retrieval of timely information available in a user-friendly manner.
• Lower merchant discount rate meaning lowered operating costs.
• Maximised interest income of US$2,400 on idle funds.
• Personalised and prompt level of service.
• The solution is customisable and scalable should the business requirements change at a later date.