Results of SunGardâs global payments and connectivity study reveals increased requirements for transparency and efficiency across the corporate commercial EcoSystem of suppliers, buyers, banks and other trading partners. The basis of the study is grounded in the concept that the intrinsic value of any corporation is based on its ability to drive free cash flow in a predictable fashion. The aim of the study was to uncover the primary areas that corporations should target to help them improve this predictability through increased transparency, efficiency and networking; focusing heavily on how to improve corporate to bank communication. The study revealed the following:
â¢In the wake of the financial crisis that exposed the vulnerability of financial institutions, many corporations created increased diversification of their banking partners. As a result, there is a need for multi-bank connectivity that can help these firms more efficiently communicate with multiple banks, particularly with respect to proprietary communication, and formats for each banking entity.
â¢Corporations are using a large number of dissimilar payment systems, which creates further inefficiencies and poor visibility across the network of corporate suppliers, buyers, banks and other trading participants. One holistic view of payments operations can help corporations gain transparency across the financial supply chain and improve their liquidity management.
Study Findings: 358 respondents from small to large-sized corporations across 20 primary industries throughout the United States, Europe and Asia.
â¢Increased need for multi-bank connectivity:30% of corporations grossing $5 billion or more are relying on 21 or more cash management banks.
â¢Holistic view of payments: 40% of respondents in the $5 billion category reported that they are operating with 11 or more different payment initiation systems, with 25% of these utilizing more than 21 different systems.
Mr. Dummitt continued, âIn contemplating commercial trade, the concept that settlement of corporate to corporate transactions often takes 30, 60 or even 90 days clearly indicates that there is an enormous opportunity for improvement. SunGardâs strategy is to operate as a community leader, helping to drive transparency and efficiency in the corporate commercial EcoSystem through data aggregation, connectivity, the creation of relationships within the EcoSystem, and the delivery of value-added services between these entities.â