93% of treasurers say forecasting inaccuracies led to avoidable losses over the past two years

As businesses grapple with disruption across multiple fronts, managing financial risk is increasingly complex, according to HSBC’s newly released ‘Corporate Risk Management Survey 2024’. Treasury departments are under growing pressure, not only to mitigate financial risks but also to provide the stability that enables companies to seize new opportunities.

One of the most notable challenges highlighted by the survey is the difficulty in managing foreign exchange (FX) risk, with 47% of respondents admitting that their businesses are poorly equipped to handle it. This vulnerability stems from volatile exchange rates driven by unpredictable geopolitical events, soaring inflation that distorts revenue and cost projections, and ongoing supply chain disruptions that disrupt cash flow timing.

A staggering 93% of respondents pointed to inaccurate cash flow forecasting data as a persistent issue, leading to avoidable losses due to overborrowing or liquidity shortfalls over the past two years. Inflationary pressures are unlikely to ease anytime soon, with 48% of those surveyed expecting higher financing costs over the next three years. This outlook is prompting many treasury teams to reconsider their debt strategies, with 37% having increased their proportion of fixed-rate debt in the last three years and 44% anticipating further increases over the next three.

The role of treasury in corporate strategy is gaining prominence, with 68% of respondents agreeing that the treasury function plays a critical role in strategic decisions—up from just 41% in 2021. This trend is especially evident in the Asia-Pacific (APAC) region, where 78% of respondents acknowledged treasury's growing influence. Despite these improvements, only 4% rated communication between treasury and the C-suite as highly effective, signalling room for better alignment at the top.

Even amid uncertainty, financial leaders remain optimistic about near-term revenue growth. Rising customer demand and faster adoption of new technologies were cited by 75% of respondents as key growth drivers, while 52% pointed to easing geopolitical tensions. However, inflation (58%) and concerns over a prolonged economic downturn (55%) continue to loom large.

Environmental, social, and governance (ESG) risks are also climbing the agenda for corporate treasurers. Some 32% of companies have already embedded ESG guidelines into their supply chains, yet 99% of respondents expressed some degree of concern over ESG visibility into suppliers, with 56% "very concerned" about meeting ESG reporting requirements. This challenge is particularly pronounced in Europe, where regulatory scrutiny is most intense. Notably, 27% of companies expect to terminate supplier contracts over ESG compliance issues in the next three years.

The report also sheds light on the rising influence of artificial intelligence (AI) in risk management. An overwhelming 61% of respondents believe AI will significantly enhance their company’s profitability over the next three years, with an equal percentage anticipating that AI will become crucial for risk management decisions. However, 62% expressed concerns over the lack of skilled talent necessary for successful AI adoption.

 

Only 2% of businesses have implemented firm-wide cyber resilience

Almost four-fifths (77%) of organisations expect their cyber budget to increase over the coming year as organisations cite unpreparedness to an ever-expanding surface of cyber vulnerabilities, according to PwC’s 2025 Global Digital Trust Insights survey.

The survey, which surveyed 4,042 business and tech executives from across 77 countries and territories, finds that only 2% of companies surveyed have implemented cyber resilience across their organisation, even as more than three-fifths (66%) of tech leaders rank cyber as the top risk their organisation is prioritising for mitigation over the next 12 months. This comes as the average cost of a data breach across all respondents is US$3.3M.

As organisations increasingly operate across digital platforms, two-thirds (67%) note GenAI has increased their attack surface over the last year.

This year’s survey findings highlight that what worries organisations most is what they’re least prepared for. The top four cyber threats found most concerning — cloud-related threats (42%), hack-and-leak operations (38%), third-party breaches (35%) and attacks on connected products (33%) — are the same ones security executives feel least prepared to address.

As companies contend with cyber security concerns, almost four-fifths (78%) of leaders surveyed have ramped up their investment in GenAI over the last 12 months, with 72% increasing their risk management investment in AI governance. This comes as two-thirds (67%) of security leaders note GenAI has expanded the cyber-attack surface over the last year, ahead of other technologies such as cloud technology (66%), connected products (58%), operational technology (54%) and quantum computing (42%). However, while leveraging GenAI remains key to cyber resilience strategies, organisations face several challenges when incorporating the technology, notably with existing systems/processes (39%) and a lack of standardised internal policies governing its use (37%). 

There is also a clear cyber security imperative. Organisations cite investment in cybersecurity as a key differentiator for competitive advantage, with 57% citing customer trust and 49% citing brand integrity and loyalty as primary drivers for such investment. In the backdrop, cyber regulations are also driving investment – with 96% reporting such regulations to have increased their cyber investment in the last 12 months.

“Cyber resilience is everyone’s responsibility, from the boardroom to the employee,” said Sean Joyce, Global Cyber & Privacy Leader, PwC US. “We must hold each other accountable and ensure we address emerging risks by leveraging new technology, practicing foundational cybersecurity principles, and investing in resources that will secure the future of the organisation.”

 

Industry expectations for instant payments by 2028 revealed

The US Faster Payments Council (FPC) has released its 2024 US Instant Payments Adoption Quantitative Study, looking at US-based third-party enablers to financial institutions (FIs). Collectively, respondents to the study serve over 90% of US FIs and provide insights into the projected growth of instant payments adoption over the next five years.

The study sheds light on how various factors, including use cases, benefits, and industry challenges, are shaping the future of instant payments. Key findings include that survey respondents believe between 70-80% of financial institutions are expected to receive instant payments by 2028, while 30-40% will have the capability to send instant credits by the same year. Early adoption drivers include earned wage access, wallet funding, P2P, marketplace/gaming and brokerage payouts, while mid-term use cases like B2B payments and online banking bill pay are anticipated to spur broader adoption.

“The results of this new study highlight the momentum and optimism within the payments industry,” said FPC Executive Director Reed Luhtanen. "The widespread adoption of instant payments will not only enhance user experiences but will also foster greater competition, innovation, and inclusion in financial services. The FPC remains committed to addressing the headwinds and enabling faster payment solutions for all."

The study also provides a clear view of the headwinds and tailwinds impacting instant payments adoption. Key challenges include the development of ubiquitous fraud prevention tools and end-user interfaces. However, enablers also identified strong tailwinds such as use case-driven approaches and expanding rules and standards, which will help accelerate adoption.

 

Kyriba opens data centre in Saudi Arabia

Kyriba has announced it will open what it bills as a state-of-the-art data centre in the Kingdom of Saudi Arabia in Q1 2025. This expansion supports the Kingdom's 2030 vision initiative and emphasises Kyriba’s commitment to digital transformation, innovation, and sustainable regional growth, a statement from the firm said. 

The new data centre will ensure full compliance with the Kingdom's regulatory mandates for data residency, empowering CFOs and treasurers with the confidence to optimise their liquidity performance.

“Saudi Arabia's compliance regulations require that data be stored domestically and our new data centre will help our customers meet these requirements,” said Amer Chebaro, Sales Leader, CEMEA, Kyriba. “This investment also underscores our commitment to supporting our clients' digital transformation while helping them improve their overall liquidity performance.”

This data centre should enhance the performance and reliability of Kyriba’s solutions, helping reduce latency while ensuring data remains secure within the region. The company says that this investment showcases its unwavering commitment to delivering faster, more secure, and fully compliant experiences for its customers in Saudi Arabia, in line with local data sovereignty and regulatory mandates.

 

Visa introduces tokenised asset platform

Visa is attempting to bridge existing fiat currencies with blockchains through its new Visa Tokenized Asset Platform ( VTAP), a product designed to help financial institutions issue and manage fiat-backed tokens on blockchain networks. The VTAP solution is available on the Visa Developer Platform for participating financial institution partners to create and experiment with their own fiat-backed tokens in a VTAP sandbox.

Visa has a global network of more than 15,000 financial institutions and helps facilitate seamless transactions of fiat currencies across more than 200 countries and territories. Now, Visa is applying its expertise in new technologies, such as smart contracts, to enable banks to issue and transfer fiat-backed tokens over blockchain networks.

VTAP has been developed by Visa’s in-house blockchain experts. The platform is a B2B solution designed to enable banks to bring fiat currencies on-chain in a safe, seamless, and efficient manner. It provides a platform for banks to mint, burn and transfer fiat-backed tokens, such as tokenised deposits and stablecoins, and experiment with use cases. This is available in a test environment with plans to support live programmes in 2025 and when participating banks are ready to launch with end customers. VTAP requires minimal technical integration, as participating banks can access the complete suite of VTAP services via APIs designed to help enhance existing financial infrastructure to be always on and more efficient.

VTAP is designed to enable banks to use their fiat-backed tokens within smart contracts. This could help digitise and automate existing workflows and power the future exchange of new types of real-world assets. For example, a bank could automate processes like administering complex lines of credit using smart contracts and using fiat-backed tokens to release payments when payment terms are met. A bank could also enable their customers to use a fiat-backed token to purchase tokenised commodities or tokenised treasuries with near-real time settlement onchain.

There is a growing ecosystem where tokenised real-world assets are being issued across multiple permissioned and public blockchain networks. Visa’s vision is to enable interoperability across different blockchains for banks utilising the VTAP platform. With a single API connection to VTAP, in the future, banks can enable multiple use cases and interact with partners and clients on both permissioned and public blockchains. To support the broad ecosystem adoption of tokenised assets, Visa is committed to enabling safe and secure cross-chain exchanges of tokenised real-world assets using fiat-backed tokens.

BBVA has been working in the VTAP sandbox throughout this year and has been testing core VTAP sandbox functionalities including the issuance, transfer and redemption of a bank token on a testnet blockchain, as well as interactions of the token with smart contracts with the goal of launching an initial live pilot with select customers in 2025 on the public Ethereum blockchain.

 

IFC and HSBC Asset Management expand partnership to support EM sustainability

IFC, a member of the World Bank Group, and HSBC Asset Management (HSBC AM) has announced an agreement to establish a specialised fund vehicle targeting corporate bond issuers in emerging markets (EM), aiming to increase access to finance and support sustainable growth.

The fund will support the existing HSBC Global Emerging Market Corporate Sustainable Bond Strategy and invest in publicly listed bonds issued by corporate and financial institutions in emerging markets.  It will be classified as Article 9 under the Sustainable Finance Disclosure Regulation (SFDR) - its highest level of classification in terms of sustainability.

“By aligning with SFDR Article 9, which places a strong emphasis on issuer-level sustainability and transparency beyond just an issuance’s use-of-proceeds, the HSBC corporate bond strategy will support the growth of sustainable businesses and accelerate their green transition,” said Mohamed Gouled, Vice President of Industries, IFC. “IFC's investment is expected to mobilise additional institutional investors and increase the pool of capital dedicated to sustainability-related transactions in emerging markets.”

The collaboration between IFC and HSBC AM aims to further drive sustainable growth and impact in emerging markets by investing in key areas such as sustainable technologies and social impact. While emerging market countries comprise more than 80% of the world’s population, they capture a much smaller share of global financing. Significant investment is needed to advance and accelerate their transition to a sustainable future.

The HSBC Global Emerging Markets Corporate Sustainable Bond strategy seeks to make positive environmental, social and governance (ESG) change and measurable impact by investing in EM corporate bonds and related securities that contribute to the UN SDGs, as well as help bridge the financing gap for EM corporate issuers. IFC will support the strategy with a proposed $100m anchor investment in the fund.