Treasury News Network

Learn & Share the latest News & Analysis in Corporate Treasury

  1. Home
  2. Cash Flow Management & Forecasting
  3. Payment & Collection Factories

A complete POBO & ROBO payment factory making subsidiaries ‘bank-free’ is possible

Payment factories are now a well established part of many corporate’s cash management infrastructure typically covering a region, e.g. Western Europe, Asia-Pacific. They open up opportunities to centralise and standardise payment processes across the whole region cutting costs, errors and fraud possibilities. They become even more effective if the regional/central payment factory can pay on-behalf-of (POBO) and/or collect receipts on-behalf-of (ROBO) so making the local units making the local units completely bank free.

Roche's new ”100% In-House Bank"  - payments/collections factory solution

Roche already runs a payment factory across the globe - and is now implementing in 11 countries across Europe full ‘on-behalf-of’ operations for payments and receipts with payment being made from/to:

- one bank account per currency with local bank in-country (for EUR only 1 bank account in EUR-zone)

- there can be two separate bank accounts for payments and for receipts where the bank does not offer virtual accounts.

Payments include all salary payments, tax payments, bank guarantees, etc., so the local entities are ‘bank free’.

For example, the payment and collections factory for the Nordic region, is now a complete ‘on-behalf-of’ model with:

  • the central in-house bank entity (NL-based) holding accounts (in the local banks) in DKK, NOK, SEK
  • all local entities have no own local bank account (they are literally "bank-free")
  • all collections and payments are executed by the Dutch-entity on behalf of the local subsidiaries, including all salary payments, tax payments, bank guarantees, etc.

If the IHB changes its bank account in the payment factory, all the local subsidiary has to do is to inform its customers about the bank account change. 

Future development

The Roche payments/collections factory solution has been so successful that they are planning to launch the concept in Asia in 2016, starting with a pilot in Hongkong in Q1.

CTMfile take: Roche are to be congratulated on making their ”100% In-House Bank" - payments/collections factory solution work. This is the ultimate solution in making and collecting payments.

Like this item? Get our Weekly Update newsletter. Subscribe today

Also see

Add a comment

New comment submissions are moderated.