ING have expanded their Virtual Cash Management solution - see below - to cover 16 additional countries in Europe, this is a major increase from two countries when they first launched their product in October 2016.
ING Virtual Cash Management solution
Source & Copyright©2017 - ING
The solution makes it possible to include an unlimited amount of entities trading in the following currencies: CHF, EUR, GBP, JPY, and USD. ING expect that the number of currencies “to grow rapidly”.
Benefits from VCM
ING claim there are many benefits from their VCM solution, including:
- improved payment reconciliation from two separate processes for:
- correctly specified accounts: paymens are routed direct to the correct account
- incorrectly specified accounts, e.g a French IBAN is used rather than the virtual account number, are routed to a temporary account in which the account is manually corrected and then posted. As the VCM solution is self learning, the next time a payment is received with the wrong IBAN it will automatically routed to the correct account
- optimising working capital from having the right information at the right place at the right time through access to detailed information of the whole supply chain enabling further optimisation of their P2P, O2C and forecasting. For example:
- on the purchasing side, a company is better equipped to monitor where and when suppliers are being paid, allowing for the optimisation of Days Payables Outstanding
- on the sales side, VCM will allow a company improved monitoring of late payments, as well as increase the speed of reconciliation through invoice matching.
ING say that, “A number of corporates are actively involved in the co-creation and roll-out process of ING’s Virtual Cash management to make sure the different needs arising from their daily business are met. They operate in a number of industries, including shipping, hospitality and chemicals.”
ING believe that the key differentiators in the ING VCM solution are:
- Facilitating cash centralisation and helping rationalise bank account structures
- Increasing straight through processing and reconciliation
- Lowering barriers to entry around POBO/COBO
- Self-service, multi-bank cash management dashboard
- Creating an in-house bank, without the cost of in-house software.
CTMfile take: The basic benefits of virtual account structures inevitably include: improved cash centralisation, rationalising bank account structures, increased STP and payment reconciliation which support POBO/ROBO, optimised working capital management, and support for in-house bank solutions. The real differentiators between the growing number of virtual account solutions from the banks and fintechs include: which currencies can be covered, the functionality and flexibility covering multiple entities, and many other aspects such as the ease of use in managing and delivering these benefits. It is early days in the bank virtual account solution market, but the progress ING have made since October 2016 is impressive.
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