The challenge

As Walmart expands in China and imported goods become particularly welcomed by local consumers, the company found itself encountering the following challenges in its treasury operations:

• Highly labour-intensive process in handling cross-border payments due to China’s complex regulations. The large volume of documents to be prepared and delivered to banks led to significant delays in the settlement cycle and inefficiencies in reconciliation.

• Increased FX exposure due to overseas suppliers requiring payments in local currencies.

• Wholly manual process on excess cash management led to reduction of investment returns.

The solution

To overcome these challenges Walmart embarked on a transformation journey to fully digitalise its treasury operations. Partnering with a fintech partner and key banks, a comprehensive solution was implemented allowing Walmart to achieve more efficient processes and optimised cash management including:

• Automation of payment and reconciliation – Walmart established API connectivity with key banks to transmit import payment instructions directly to the banks in real-time. This connectivity provides real-time visibility of payment status and balance movements. Walmart integrated with China Customs’ e-portal and utilised the robotic process automation (RPA) technology to automate the customs clearing process for the company’s imports. The end-to-end system integration and the fully automated data submission has allowed Walmart to further streamline the cross-border payment process, leading to significantly reduced operational workloads, improved reconciliation efficiency and shortened settlement cycles.

• Go paperless for cross-border payments – leveraging years of a proven track record with the China regulators and the strong post-transaction monitoring mechanisms co-built by Banks and Walmart, an approval to simplify the cross-border payment process was granted by the State Administration of Foreign Exchange (SAFE). Walmart can process over thousands of cross-border transactions annually with a total value exceeding millions of dollars entirely document–free.

• Automation of FX management – Walmart China’s sales proceeds are all CNY while imports annually all need to be paid in the suppliers’ local currencies. To manage FX exposure, Walmart leveraged the API connectivity with Citi to retrieve real-time FX rates for all currency pairs they deal with.

• Automation of deposit management – retrieving data from the bank, Walmart designed a rule-based model to provide real-time visibility on deposit positions and returns. This model also populates timely and accurate liquidity forecasts, aiding the treasury team in optimising and diversifying its investments.

• Go green on excess cash investment – in China, the treasury team is taking the lead to actively support Walmart’s ESG initiatives and integrating sustainable aspirations into day-to-day treasury operations. By putting cash reserves in sustainability-linked deposit programmes, the company exemplified its dedication on zero commissions and zero waste, and took a regenerative approach to nature.

Best practice and innovation

Walmart China not only focused on enhancing treasury processes but also actively participated in supporting ESG initiatives. The solution implemented is an excellent example of a holistic approach to creating sustainable value for the company’s stakeholders and the wider community.

By leveraging cutting-edge technologies and collaborating with its bank, Walmart successfully automated and simplified payment processes, optimising efficiency and accuracy while minimising operational burdens. This technology-driven transformation sets Walmart apart as a pioneer in the retail industry in China, where automation is becoming increasing important for sustainable growth.

Walmart’s efforts in promoting ESG towards treasury management is commendable. Its active participation in sustainability-linked deposits further demonstrates its dedication to creating a positive impact on the planet.

Key benefits

• Cost savings.

• Headcount savings.

• Process efficiencies.

• Increased automation.

• Risk mitigated.

• Improved visibility.

• Errors reduced.

• Manual intervention reduced.

• Increased system connectivity.

• Future-proof solution.

“We have successfully automated our treasury operations and integrated sustainability principles into treasury management. This transformation not only improved efficiency but also aligned with our mission to be a sustainable and responsible global leader in the retail industry.”

Susan Wu, China Treasury Director