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Treasury Management System (TMS): What are they and what are they for?

What are treasury management solutions?

Treasury management systems (TMS), are a set of instruments, procedures and technological advances that companies use to effectively manage their financial resources, cash flows, investments and exposure to the risk. Optimizing liquidity, reducing financial risk and improving overall financial performance are the main objectives of TMS. The TMS includes a wide range of tasks, such as investment management, treasury management, risk management and liquidity forecasting as well as access to banks, execution of payments etc.

Businesses can have real-time access to their cash situation and balances in various bank accounts and financial institutions with the help of a complete cash management solution. By evaluating and interpreting financial data, spotting potential risks, and devising plans to improve financial performance, you help treasury teams make informed decisions.

As organizations struggle to manage their financial operations, the importance of Treasury Management solutions has increased dramatically in recent years. Businesses need a TMS that is resilient and adaptable to cope with the changing financial landscape and regulatory constraints brought about by the globalization and digitization of financial services.

It should be noted that in recent years, treasury management and TMS systems have been within the reach of a few. Only accessible to large companies. However, thanks to platforms like Snab, this is becoming more democratized.

What are some example of TMS platforms that offer treasury management solutions

There is currently a wide range of treasury solutions, however these are not well known. The vast majority are foreign systems or companies and as we said, it is possible that they are only known by large companies that potentially used one of these systems. . These platforms often offer various capabilities to simplify treasury operations and interface with a company’s current financial systems. Some of the best known TMS platforms are:


  1. Kyriba: Kyriba is a cloud-based TMS that offers a range of products, such as supply chain finance, risk management, payments, and treasury management. It offers real-time data and insights to help companies improve their financial situation.
  2. TreasuryXpress: TreasuryXpress is suitable for mid-sized organizations, offering treasury forecasting, banking connectivity and payment processing capabilities.
  3. SAP Treasury Management: As part of its ERP system, SAP provides a comprehensive TMS module that integrates with other operational and financial modules. It allows companies to better monitor their financial operations by centralizing their treasury functions.
  4. Reval: Reval, now part of ION Treasury, focuses on risk management, treasury forecasting, and hedge accounting, making it a good fit for companies with complex hedging needs.
  5. FIS Quantum: FIS Quantum offers several treasury solutions, such as debt management, risk management, and cash management. With important treasury operations, it provides services to large companies and financial institutions.
  6. Snab: Snab is one of the most innovative treasury solutions on the market that allows companies to manage access to banks, execution of payments, and cash management and treasury forecasts from a single centralized place.

Advantages of digitizing a company's treasury management

A company can gain several benefits by digitizing its administration and management of the treasury area, such as greater operational efficiency, less risk and better decision making. Listed below are some of the main benefits of digitizing treasury management:


Availability in real time:

One of the most significant benefits of digitizing treasury management is real-time visibility. Treasury teams can use a digital TMS to get up-to-date information on cash positions, cash flows, and bank balances across numerous accounts and financial institutions. This real-time data enables treasurers and financial professionals to make timely and informed decisions.

For example, if a company has to make a critical payment or deal with unforeseen liquidity demands, the treasury team can analyze existing cash, cash flow estimates and alternative funding sources in real time. This transparency ensures that the company has enough cash to meet its financial obligations, reducing the danger of late payments or costly loans.

In addition, real-time visibility allows effective concentration and pooling of cash, as the treasury can quickly detect excess funds in one account and transfer them to another that needs more money. You can learn more about this operation by reading our previous article on “cash pooling”. This optimization of treasury resources maximizes interest income and reduces borrowing costs.


Efficiency and automation:

Treasury management can be digitally transformed to automate repetitive activities, thereby reducing human labor requirements and increasing operational efficiency. Automating routine tasks like data entry, payment processing, and reconciliation reduces the chance for errors and delays. Both are very important since any human error or delay in a payment can have important implications for the business and cause a substantial loss of time.

For example, the system can automatically reconcile bank statements with internal information, drastically saving time spent on human reconciliation processes. By ensuring division of duties and approval procedures, automation also ensures compliance with business rules and lowers the risk of fraud.

In addition, the connectivity of the TMS with other financial systems (for example, Enterprise Resource Planning – ERP) improves data flow and eliminates the need for duplicate data entry, resulting in a more unified and efficient financial environment. Good integration with ERP accounting systems is essential for the success of a good TMS.


 Risk Management:

Effective risk management is essential for the financial stability of a company and its protection against possible interruptions. A digital TMS offers tools and analysis for the identification, measurement and mitigation of financial risks.

For example, the system can assess interest rate exposure and recommend appropriate hedging techniques to protect against interest rate fluctuations. By disclosing information about currency exposure and recommending appropriate currency hedging products, you can help monitor and manage currency risk.

In addition, TMS digital platforms often have scenario modeling and stress testing capabilities. Treasurers can use these features to simulate different market circumstances and determine how they will affect the company’s financial position. Treasury teams can create backup plans to mitigate unfavorable outcomes by recognizing likely risk situations.



Reports and regulatory compliance:

The digitization of treasury management facilitates compliance with various legal regulations and financial reporting standards and facilitates reporting tasks. The system can provide accurate and timely reports, ensuring compliance with accounting standards such as International Financial Reporting Standards (IFRS) or Generally Accepted Accounting Principles (GAAP).

In addition, centralized and consistent reporting makes it easy for auditors and regulators to access the necessary financial data, speeding up the audit process and reducing the likelihood of non-compliance fines.


Cost savings:

The organization can obtain significant cost savings as a result of the automation and the improvement of the efficiency of the processes thanks to digitization. Companies can save personnel costs and effectively manage resources by reducing the need for manual interventions.

In addition, a digital TMS allows for improved visibility of fees and expenses related to banking services, allowing treasury teams to improve their negotiating position with financial institutions. Over time, negotiating reduced transaction fees and service costs can save a lot of money.

Additionally, by improving cash management and forecasting, companies can avoid excessive borrowing or additional idle capital. Reducing borrowing costs and increasing interest income from excess funds directly influence the company’s results.


Strategic determination:

Access to real-time data and advanced analytics enables treasury teams to make strategic decisions consistent with the company’s financial goals. Historical data analysis helps identify trends and patterns, enabling more accurate forecasting of cash flows and working capital needs.

Treasurers can successfully establish investment plans that align with the risk tolerance and growth objectives of the company, having access to comprehensive information about the financial situation of the company. This involves maximizing the investment portfolio, diversifying assets, and researching short- and long-term investment prospects.

In addition, TMS digital platforms often offer tools for scenario planning. Treasury teams can model different market situations, economic scenarios and future mergers and acquisitions. Treasury teams can make well-informed decisions that prepare the business for many future possibilities by being aware of the potential implications of various situations.


Flexibility and scalability:

State-of-the-art digital treasury management systems are located in the cloud and built to be scalable and adaptable to the changing requirements of growing businesses. The treasury management solution can be adjusted to accommodate increased transaction volumes and complexity as a company grows, enters new markets, or conducts mergers and acquisitions.

A versatile TMS can also interface with different banking institutions and financial systems, ensuring compatibility as the company’s financial environment changes. This flexibility reduces disruptions in times of change and allows treasury teams to focus on strategic goals rather than fighting technical constraints.

Treasury Management Solutions for Global Companies:

Treasury Management Solutions (TMS) are essential to help international organizations manage their financial operations efficiently and overcome the particular difficulties of doing business in several different countries. The implementation of TMS platforms is crucial to maximize financial performance and reduce risk for multinational organizations, as they face a number of issues related to regulatory compliance, foreign exchange and treasury management.

Treasury management is one of the main difficulties faced by international companies. Cash can be challenging to manage across multiple companies and regions, which can lead to inefficient use of available liquidity and potential financial imbalances. TMS platforms offer real-time visibility into the cash situation across multiple accounts and geographies. As a result, treasurers can efficiently manage working capital, pool cash, and maximize cash pooling. Consolidating cash resources enables more effective investment choices and lower borrowing costs, improving overall financial efficiency.

Another important problem for international companies is exchange risk. Changes in exchange rates can have a significant effect on cash flows and earnings. Treasurers can identify currency exposure and apply hedging measures to limit currency risks using TMS platforms with powerful currency management features. These solutions support the evaluation of risk scenarios and the selection of appropriate hedging instruments using historical and real-time data, protecting the company’s financial position.

On the other hand, regulatory compliance across multiple governments and regions is a major hurdle for organizations operating globally. Regulatory structures, reporting standards and tax obligations differ from country to country. By automating reporting procedures and producing accurate and consistent financial reports that follow local regulations, TMS solutions make compliance easy. This reduces the potential for errors and non-compliance and ensures effective communication with auditors and regulators.

TMS technologies also help global corporations improve internal controls and drive transparency. The potential for internal fraud and mismanagement increases when there are multiple organizations operating in different locations. TMS systems reduce the risk of illegal actions and ensure effective segregation of duties by centralizing treasury processes and setting secure access restrictions.

Also keep in mind that it can be difficult to collaborate across international teams, especially when managing treasury operations. Cloud-based accessibility TMS solutions enable real-time data sharing and collaboration among geographically dispersed teams. As a result, treasurers are better able to collaborate effectively, communicate effectively, and make sound financial decisions.

The future of Treasury Management Systems (TMS)

As technology continues to advance rapidly, there are exciting opportunities for Treasury Management Solutions (TMS) in the future. Emerging technologies and trends will change treasury management procedures, bringing unprecedented levels of automation, efficiency and risk control. Below, we make some guesses about several crucial variables that could affect the trajectory of TMS in the coming years.

  1. Integration of artificial intelligence (AI) and machine learning (AM): AI and ML technologies are expected to have a major impact on treasury management in the future. These cutting-edge tools can analyze huge volumes of financial data, spot trends, and make forecasts based on that data. The accuracy of treasury forecasts will be improved, investment options optimized and real-time market insights on risks delivered via AI-powered TMS platforms. By examining historical data and determining the best hedging points, ML algorithms will also be able to help treasurers create more complex hedging plans.
  2. Blockchain and Distributed Ledger Technology : These innovative tools have the potential to revolutionize a number of financial operations, including payments and settlement, due to their decentralized and transparent nature. Blockchain-based TMS solutions could improve security, reduce transaction costs, and facilitate international trade. There may be less need for manual involvement if key treasury procedures, such as payment execution and compliance verification, are automated using smart contracts on blockchain networks.
  3. Internet of Things (IoT) Data: The Internet of Things (IoT) is increasingly connecting devices and producing vast amounts of data across a variety of businesses. In order to increase the accuracy of treasury forecasts, TMS platforms could eventually incorporate IoT data from supply chain sensors, point-of-sale systems, and other sources. Treasurers will be able to better predict their treasury demands thanks to this integration, which will also improve working capital management.


TMS systems are treasury management systems complementary to ERP that provide substantial advantages to companies and that mainly facilitate management and decision-making in the area of ​​cash management. New technologies like AI, blockchain and IoT hold huge potential for the future of Treasury Management Solutions (TMS). By driving financial agility and decision making, these advancements are poised to transform cash forecasting, risk management and payment processing. TMS solutions will enable treasurers to negotiate difficulties, maximize financial performance and stay competitive in the changing global marketplace as organizations embrace these innovations. For companies that want to prosper and succeed in the rapidly evolving treasury management industry, the adoption of these cutting-edge solutions will be essential.

Snab TMS: What do we offer at Snab to help finance professionals to manage treasury?

Snab offers an innovative Treasury Management Solution that unifies banking, data and treasury operations on a single platform, ensuring transaction traceability and improving overall business performance. Snab reduces errors and decreases reliance on conventional spreadsheets like Excel by automating treasury statements and processes. This state-of-the-art method improves accuracy and frees up resources for tactical decision making.

The platform’s automation features streamline processes and enable you to perform financial tasks efficiently. A proactive approach to cash management is made possible by real-time cash monitoring, which provides current visibility into cash inflows and outflows. To ensure data accuracy and consistency, Snab also syncs with enterprise resource planning (ERP) systems.

Businesses gain a competitive advantage in the fast-paced world of finance with Snab’s extensive treasury management features. Through the integration of the platform’s banking, data and treasury processes, financial performance is optimized, boosting corporate development and success. Snab simplifies treasury management, allowing companies to successfully negotiate complexity and maintain an edge in an ever-changing marketplace.

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