Cash management and treasury management are two terms that are often used interchangeably. But, despite popular belief, these two are distinct concepts that are each fundamental for businesses of varying sizes. Whether you're a seasoned pro or a financial rookie, it’s crucial to understand the disparities between these two concepts.
One key distinction is that cash management is a colloquial term that encompasses many different practices. But, there is no specific software category for cash management. In general, cash management covers cash flow management.
Treasury management, on the other hand, is both a practice and a software category. The software category tends to be associated with larger companies but can be useful for all growing companies. Treasury management encompasses cash and liquidity management. This includes managing debt, investing, forecasting, banking, risk management, payments, fraud protection, and reporting.
The main objectives of treasury management are to maintain the business's liquidity to meet its financial obligations. This includes investing excess cash, lowering borrowing costs, and safeguarding against financial risks such as interest rate movements and credit risks. It also involves maintaining compliance with regulators and ensuring that the company's financial operations run smoothly.
Treasury management is essential for many companies. This includes growing companies in the range of $10 million to $100 million in revenue. While the needs and goals may vary, the following types of companies can benefit from treasury management:
Treasury management for SMBs and growing companies gives a tailored approach to managing financial resources. It also helps with managing financial risks. Here's what treasury management means for SMBs and growing companies:
Treasury management software is a financial technology that assists businesses in managing financial operations. The software provides a platform for automating and optimizing treasury management tasks and processes.
Here are key features and functions typically found in treasury management software:
Treasury management software provides a comprehensive suite of functions to streamline financial operations for busy teams. Here are the key functions found in treasury management software:
Centime is a comprehensive treasury management solution designed for SMBs and mid-market businesses. Its all-in-one platform automates accounts payable (AP), accounts receivable (AR), cash flow forecasting, as well as banking and working capital solutions.
As growing companies expand, they often encounter similar challenges as enterprises, but with fewer resources. While SMBs and mid-market companies may not have netting or international exposure, they still require essential features like cash forecasting, payment automation, collections, banking support, and working capital. Centime addresses these needs by offering an affordable and user-friendly treasury management solution tailored specifically for these teams, without the hefty price tag associated with enterprise solutions.
This focus on non-enterprise teams is what sets Centime apart from other treasury management providers on this list. By focusing exclusively on SMBs and mid-market teams, Centime can provide an enterprise-level treasury management solution that is otherwise unavailable in the market to non-enterprise businesses.
Kyriba is a robust treasury management software that helps large enterprises make corporate strategic decisions. The platform is a great solution for large enterprises, but lacks the support to service businesses with fewer resources.
Coupa is an enterprise cash and spend management product. The platform is another common treasury solution for large enterprises, but lacks certain tools and capabilities needed to service growing businesses.
Bottomline is a treasury management software for large corporations that focuses on business payments. It specializes in electronic payments, digital banking, and bank connectivity for enterprise teams, but lacks other traditional treasury management capabilities.
Tesorio is an AR-focused solution that also offers treasury management. Its treasury management functionality includes forecasting, cash application, and a financial care center. With Tesorio, users can improve cash performance and increase overall cash flow visibility.
While primarily recognized for its expertise in receivables automation, HighRadius extends its capabilities to provide end-to-end automation for treasury management. It offers an AI-based treasury management solution designed to empower businesses with efficient cash and treasury management capabilities.
In the fast-paced world of finance, treasury management is essential. As we conclude our Buyer's Guide to the Top 6 Treasury Management Solutions for 2023, we've delved into the diverse landscape of treasury management software to help you make informed decisions for your organization's financial well-being.
Each solution we've explored in this guide offers a unique set of features and capabilities, tailored to different niches within the finance industry. Whether you're a growing SME, a large enterprise, or somewhere in between, there's a treasury management solution designed to meet your specific needs. Here’s a quick overview of each solution discussed in detail above.
In the dynamic world of finance, choosing the right treasury management solution is a strategic move that can elevate your financial management to new heights. We hope this guide has provided valuable insights to guide you on your path to financial excellence in 2023 and beyond.
As you embark on your treasury management journey in 2023, consider your organization's size, needs, and long-term goals. Choosing the right treasury management solution for your team will streamline your financial operations, reduce risk, and empower your team to make data-driven decisions.