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Industry roundup: 22 July

Santander UK and Infosys Finacle launch international cash management platform

Infosys Finacle and Santander UK have announced the roll out of the bank's international cash management platform as part of its ongoing digital transformation programme. Santander Global Connect is a cash management platform designed to support the international growth plans for Santander’s corporate and commercial customers. 

The first release of the platform, which is currently in pilot, provides customers with access to view liquidity held globally. Subsequent releases will enable self-service digital capabilities to manage, control, and mitigate cash and business risk, from a single portal. The partners say that client feedback will form a critical part of future enhancements, to ensure the global cash management platform meets and exceeds client requirements.

Santander Global Connect will be powered by the Finacle Cash Management Suite that includes the Finacle Digital Engagement Hub, Finacle Online Banking, Finacle Payments and Finacle Liquidity Management solutions.

Key capabilities of the new platform will include acentralised multi-bank information portal with a consolidated view of cash positions, account and transaction level reporting for both domestic and international activities, and country level visibility of foreign currency accounts held, and banks used by customers.

"This new platform will allow us to support UK businesses of all sizes to seamlessly manage their international transaction and cash management banking needs," said John Carroll, head of International and Transactional Banking at Santander UK. "It will also help us to develop and grow relationships with existing customers and support the international growth needs of new customers. There has never been a more important and exciting time for businesses to consider international expansion. By collaborating with Finacle, we’re able to offer our customers a crucial tool to support both them and our own international banking strategy now and in the future."

"With the increased volatility and complexity of the global business environment, corporate treasurers need to monitor and manage their liquidity positions and working capital in real-time," commented Sanat Rao, chief business officer and global head of Infosys Finacle. "We are excited to extend our partnership with Santander UK to enable this for their corporate and commercial banking customers. The new platform will power innovative global cash and liquidity management services, along with much-needed flexibility, openness, and self-serve capabilities."

 

ARRC recommends loan conventions and best practices for use of forward-looking SOFR term rate 

In anticipation of the Alternative Reference Rates Committee’s (ARRC) impending formal recommendation of the forward-looking Secured Overnight Financing Rate term rates (SOFR Term Rates) produced by the CME Group, the ARRC is announcing conventions and use cases for how best to employ the SOFR term rates to successfully transition away from US dollar (USD) LIBOR. The ARRC’s formal recommendation will complete the last step in making the SOFR term rates widely available, and is expected to follow shortly after the July 26 move of interdealer trading conventions to SOFR.

"Market participants now have the tools and necessary guidance to support use of the SOFR term rate in transitioning away from LIBOR," said Tom Wipf, ARRC chairman and vice chairman of Institutional Securities at Morgan Stanley. "Once the SOFR First swaps convention switches on July 26th and the ARRC formally recommends the SOFR term rates, market participants should have what they need to use SOFR in all its forms across financial markets, including the use of the SOFR term rates for business loans."

In its recommended best practices, the ARRC has highlighted particular areas where use of the SOFR term rates will be helpful to support a smooth transition away from USD LIBOR, taking into account feedback from a broad set of stakeholders. The SOFR term rates will be particularly helpful for the business loans market - particularly multi-lender facilities, middle market loans, and trade finance loans - where transitioning from LIBOR to an overnight rate has been difficult. The Best Practice Recommendations also support the use of SOFR term rates in end-user facing derivatives that hedge cash instruments linked to the term rates, and certain securitisations with underlying assets that are themselves tied to SOFR term rates. 

To help further facilitate the use of the SOFR term rates and SOFR averages in advance, the ARRC has published recommended conventions for these rates in the business loans market. The ARRC has previously released recommended conventions for the use of SOFR in arrears using both daily simple SOFR average and a compounded SOFR average.

 

Sezzle launches working capital solution for merchant partners

Payments company Sezzle has announced the upcoming launch of 'Sezzle Capital', a programme enabling retail partners with working capital up to US$10m. Powered by Wayflyer, a funding platform, Sezzle Capital provides merchants with a bridge to unsecured funds. The new programme aims to solve the difficult task e-commerce businesses have in sourcing working capital. Sezzle Capital offers higher approval rates than traditional lending and simple pricing models to e-commerce businesses.

The partnership with Wayflyer allows Sezzle to provide much needed financing to its merchant partners without any credit risk or additional capital requirements to Sezzle.

"We've listened carefully to our merchants and we understand that one of their biggest pain points is cash flow," said Paul Paradis, president of Sezzle. "By providing quick and effective access to funding, Sezzle Capital will ensure our merchants are less stressed about the day-to-day and fully focused on growing their businesses while at the same time it helps to strengthen our relationships with our customers."

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