eBAM (electronic Bank Account Management) is still a disappointment for most corporates, but a recipe for successful bank account management (BAM) followed by various flavours of eBAM is emerging.
1. Clean up your bank data, set up central BAM database and procedures
Many corporates have presented at conferences, including IBM and Mars UK, how the essential first step in BAM is to clean up the errors and duplications, and then develop a central database on your bank account holdings world-wide. The next is to develop internal workflows and systems to: open and close accounts, manage the power of attorney, reduce time taken in the signature cycle, etc.
It is also useful to develop a universal banking agreement as Bombardier did in 2010, to streamline their bank documentation. Some of the improvements in the streamlined documentation include: only two to three items now require a signature—and without additional legal review, new country additions have been simplified, and legal input only is required on new country exception items.
Also, some large corporates are starting to encourage(insist) their lead banks to standardise their documents, processes and workflows.
2. Use bank’s individual eBAM solutions
Next, because they have found that the inter-bank eBAM is not yet really viable across many banks, large corporates are using their lead banks’ own eBAM solution. Although the large corporate may have to use three or four eBAM solutions, they have found that the improvements in BAM are significant. Even when they just scan and upload bank account PDFs/documents, the management and tracking are much more efficient.
3. Move to inter-bank eBAM when it works
Inter-bank eBAM will eventually happen as the initiatives, such as the US banks’ Global Rapid eBAM Adoption Team (GReAT) group, help normalise the workflows, documentation and use of the message standards in eBAM across the majority of cash management banks around the world.
This is what corporate treasury departments really want, and they will use the systems and standards when they truly work. But until then, using a collection of individual banks’ eBAM solutions combined with their own central BAM database is the best corporates can achieve at present.