Is It About Time to Upgrade Your Treasury Management Systems?

businessman working with treasury management system on phone

Keeping your treasury management system (TMS) up-to-date can save your financial organization time and money while allowing it to be more flexible in its finances.  However, these benefits could only be maximized if the TMS itself is a good match for the business’s needs.

However, a business’ needs evolve with time and other external factors. Even if an organization selected a great software 10 or even 5 years ago, chances are that it may already be in need of an update or a replacement. Most organizations operate in a dynamic environment where much can change in a relatively short time, making it important to do periodic evaluations of systems, especially ones as critical as a treasury management solution.

If any of the five items below apply to you, it may be time to shop around for a better, more efficient treasury management system.

1. You’re Still Using an Onsite TMS

As Software as a Service (SaaS) options have become more ubiquitous and mature, the debate on whether “cloud” systems are better than self-hosted or onsite systems is now more or less settled. Today, the consensus is that the vast majority of organizations will reap more benefits from cloud-based services compared to traditional onsite systems. 

While onsite systems tend to offer banks and other financial institutions full control, they require the organization to maintain and update the IT infrastructure needed to support such systems. In the case of treasury management solutions, the IT personnel involved also need to understand day-to-day banking and finance operations. Not being able to find the right people or invest in the correct technology can result in critical inefficiencies and vulnerabilities in the organization’s finances.

With a cloud-based TMS, however, not only can organizations spend less to achieve better results, but they no longer need to go through a grueling hiring process for qualified finance IT specialists. If your current TMS is not on the cloud, you should be seriously considering replacing it with one that is.

2. It’s Hard to Create Good Reports

Reporting functions are an often-overlooked aspect not just of treasury management systems, but enterprise resource programs (ERPs) in general. However, good reporting is essential for data-driven decisions, which means reporting functions need to be robust, accurate, and fully featured if they are to be useful for an organization.

Additionally, some important decision-makers both inside and outside the organization may not have a deep background in finance or other esoteric fields. This means software that facilitates transparent, accurate, and easy-to-understand reporting is almost certainly a plus.

When it comes to report generation, older TMS systems may be more difficult to work with. They may not have the report generation functions of newer software, and they may not be able to draw data automatically from other parts of the organization. This results in more tedious, error-prone reporting that further reduces the software’s utility. If any of these are the case, you’re better off upgrading your TMS.

3. Your Treasury Management Solution Integrates Poorly With Other Systems

Unless your TMS is part of a larger ERP suite created by a single developer, then there are no guarantees that it could be smoothly integrated with other systems. 

While there are almost certainly ways to get most disparate systems to work with each other, there is likely going to be some kind of catch, such as manual workarounds, dependence on third-party software, or the risk of serious glitches.

Serious integration issues also prevent the organization from implementing effective process automation, something that can cut costs while improving service levels. These integration problems can become worse as the organization begins to handle higher volumes of transactions, leading to slowdowns and even customer service issues.

When this happens, the best option is to either swap out your TMS with something that integrates better with your other systems or to replace everything with an integrated suite of solutions made by just one developer.

4. Your Treasury Management System Isn’t Saving You Enough Money

Finance costs can be a huge burden, particularly those related to banking service fees and foreign exchange costs. Contemporary treasury management systems are now far more complex than those developed just a generation ago, often incorporating advanced AI capabilities to further increase the cost savings to organizations.

If your current TMS is unable to save you money compared to your previous system, then there may be something wrong with how it is set up or managed. It’s also possible that it’s outdated or not a good fit for your organization, necessitating either major customization or a complete replacement.

5. You’re Having Trouble Meeting Finance Regulations

One major reason organizations invest in treasury management software is to make compliance with finance laws easier. However, meeting today’s increasingly complex finance compliance requirements is not always straightforward, especially when you’re using a treasury management system that predates newer regulations. 

While new software will not necessarily fix all problems with compliance, it’s certainly a step in the right direction, particularly if the business is starting to see increasing transaction volumes. To ensure that you’re always up to date with financial regulations, it may be a good idea to periodically reevaluate your TMS and accounting software.

With these red flags in mind, you should now have some idea if your company needs to upgrade its treasury management system. Given that any chosen system may stay with the organization for years, this isn’t a choice that could be made lightly.


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