The Future of Corporate Treasury

18 Treasury and Trade Solutions How Quickly Will Treasury Adopt New Technologies? It seems that exponential technology is currently developing faster than most of the corporate treasury users can digest. While most users are aware of these emerging technologies, they may be hesitant to start using them. One of the key questions that many of our clients ask is: “Is this technology a potential solution to any of my real day-to-day problems?” This response is comparable to the concept of self- driving cars. While everyone is aware of the concept, not everyone would be eager to step in such a car to have it drive him/her to work tomorrow. “When a user can be certain that data is reliable, and tamper-proof, it is truly a game changer. You no longer have to wait for confirmations and validation — with blockchain that is already baked- in. Trustworthy data can be used to drive business decisions with confidence.” “Blockchains are just a better toolkit. They aren’t a panacea, but just as email and spreadsheets have transformed the way we communicate and calculate, blockchain will forever change the way we share information over the internet.” Somil Goyal Chief Operating Officer, Adjoint Proof of concepts For many of the exponential technologies, we already see concept versions of the technology being available, however the mindset of corporates and thus market adoption is not fully there (yet): • A lot of organizations are experimenting with DLT proof of concepts where DLT is applied on a small scale, but so far there are not yet too many widespread applications across a broader group. While the technology around DLT may be available and ready, the standard and structures which will allow for global market adoption are currently lacking . To put it plastically, we can think of the market as the proverbial horse which can be led to the water, but we can’t make the horse drink the water. • For instance, we expect that in the coming decade DLT is going to add real value to a wide number of financial processes, e.g. ,real-time validation of company ledgers by auditing firms instead of quarterly, real-time, trade finance, payments and settlements, etc. According to the World Economic Forum, DLT is estimated to free up $1.5 trillion in trade financing and create $1 trillion in new trade over the next decade by digitalizing the entire supply chain using DLT, AI, APIs, etc. 5 Currently the practical capabilities of exponential technology are still relatively new and fairly limited to more basic treasury operations, which leads to mainly the trivial, standardized, repetitive activities being the areas of experimentation such as using APIs to connect different systems, RPA to automate bank reconciliation, ML to improve cash flow forecasting, DLT to speed up trade finance, etc. 5 World Economic Forum, September 2018. http://www3.weforum.org/docs/White_Paper_Trade_Tech_report_2018.pdf