Within just ten years, Klook has become Asia’s foremost platform for experiences and travel services, including attractions, tours, local transport and stays in over 2,700 destinations globally. “We’re here to inspire and enable more moments of joy for travellers anytime and anywhere,” says Lucia Ma, Treasurer at Klook.

The company experienced triple-digit growth compared to the pre-pandemic sales volumes and expanded into four continents. As a result, it needed to manage unpredictable merchant payment flows, as well as navigate the complexities of doing business in numerous currencies.

As Ma explains: “Klook is often paid by a consumer in one currency, while the settlement with the merchant is in another. Also, there are different settlement cycles with merchants: some are prepayments, others are later settlements. The combination of payments and receipts in different currencies and different settlement cycles created funding mismatches and reduced the utilisation of our internal cash.”

Working together

The company teamed up with J.P. Morgan Payments to tap into the bank’s new application programming interface (API)-powered foreign exchange (FX) and liquidity solution to beef up its end-to-end treasury infrastructure. According to Ma, this automated solution has enabled consumers to book travel experiences at a competitive price using their preferred currencies and payment methods.

“We are able to optimise internal liquidity across multiple functional currencies, prudently manage FX exposures and streamline large volumes of cross-border payments and collections,” she adds.

Co-creating a solution requires being attuned to how treasury works, according to Tim van Bijsterveldt, Executive Director, Liquidity and Account Solutions at J.P. Morgan Payments. “We are careful not to disrupt the existing flows of the company, especially in the travel industry where even the booking experience needs to be as pleasant as possible,” he explains.

Optimal liquidity solution

For an ecommerce platform operating in the travel industry receiving and paying out funds 24/7, it is critical that Klook has enough liquidity to cope with unexpected and unpredictable payment obligations that could be in the same or different currency than the money received.

“Our notional pooling product addresses these challenges as the company can draw down in one account – as long as it has sufficient balances in another – without being forced to convert on terms that may not be as beneficial to Klook at that time,” says van Bijsterveldt. “In addition, Klook doesn’t need to have balances or accounts in currencies which it doesn’t often use.”

“Through digitisation, we can ensure that liquidity is where Klook needs it, when the company needs it, and in the currency that it requires through an automated sweep from a single location,” according to van Bijsterveldt.

“The automated FX solution delivers a 180-degree transformation for Klook, and allows us to reduce FX risks while delivering the flexibility in pricing for the consumers,” Ma says. “Combined with a highly flexible and scalable liquidity solution, we can centralise and utilise surplus liquidity in functional currencies to meet unpredictable foreign currency payment obligations.”

Emerging technologies

Keeping her eye on future innovations, Ma is interested to see how artificial intelligence (AI) and blockchain, in particular, will impact treasury in future. “Potentially, blockchain could help achieve 24/7 real-time fund transfers, and AI may help us become more efficient and accurate in cash flow forecasting,” she says.

Van Bijsterveldt also points to 24/7 fund movements as an exciting area. “What is even more exciting is using AI and programmability to build in what we refer to as ‘intelligent liquidity’. This means that treasurers can move from a basic automated fund transfer based on a certain day, time or balance to more complex events triggering that fund movement,” he adds.

“These new technologies are providing such opportunities, which is exciting for everyone: consumers, merchants, treasurers, and financial services provider as well,” he says.