Adam Smith Awards 2018 Client Casebook

HIGHLY COMMENDED WINNER Harnessing the Power of Emerging Technology API connectivity enables PSK to achieve its business objectives Company profile Population Services Kenya (PSK) is a non-governmental organisation that provides life-saving information, products and services to tackle the most pressing health problems. The challenge Population Services Kenya (PSK) receives and generates funding from multiple sources and processes in excess of 10,000 transactions on an annual basis. Traditionally, the company initiates these payments manually on its online banking platform. However, this resulted in payment tracking limitations, reconciliation gaps and a highly manual reporting process. With efficient and scalable cash management services key to the company’s overall goal of remaining a leading provider of healthcare services, the treasury team were tasked with finding a solution to its payments challenge. The solution To overcome this issue, PSK invested in a sophisticated ERP system. It then began looking to partner with banks that could provide solutions to automate the payment and reporting. After an extensive analysis of the market, PSK decided to select Citi to provide this service and set about integrating its ERP with the bank’s platform and payment processors through APIs. PSK was keen to connect through API’s as it creates a unique messaging mechanism that interfaces directly into a company’s database and enables multiple third parties to access data in real-time without having to connect to the database itself. The API integration took place in parallel to the ERP upgrade and this enabled the two parties to build off existing functionalities with the system, reducing implementation time. Once the connectivity was in place, PSK and Citi set about testing the functionality and making the necessary changes to ensure that full straight through processing could be achieved. Once it was confirmed that everything was working as it should, PSK quickly began to realise numerous benefits. This included payment processing time being reduced from hours to minutes. Automation was also realised in its acknowledgement messaging, reporting and reconciliation processes. It has also reduced operational and financing risks whilst ensuring that PSK can cater to growing payment volumes in the short term that can support their core objectives. It is anticipated that PSK could ramp up annual payment volumes from 5,000 – 10,000 to as high as 100,000 with no additional development required. Best practice and innovation As treasury management continues to evolve, more and more organisations are leveraging 21 st century technology in the form of API’s to design, build and develop treasury protocols that solve legacy issues in payment processing methods. Historically, connectivity between banks and organisations has been highly manual and requires a large amount of time, resources and cost to enable some level of integration between systems. API solves this legacy issue by creating a bank-agnostic channel for connectivity between counterparties. The implementation of API technology in treasury management has enabled for PSK a global, flexible and fully automated delivery channel that provides visibility into their working capital flows across all bank accounts. The second-order benefits of such a solution include scalability, bank-agnostic connectivity in addition to providing long-term cost efficiencies and reduced operational risk via automation. The real-time exchange of information allows PSK to manage their treasury more seamlessly by maximising their data to deliver financial information more quickly, more safely and more cost-effectively to their banking partners. The fact that PSK is one of the first corporates in Africa to leverage APIs in this way is a testament to the treasury’s focus on developing technology and automation capabilities that enable efficiency and transparency in its banking operations. As a result, PSK is now at the forefront of not only the development sector but also treasury best practices and serves as a benchmark for other organisations in Kenya and wider Africa. Population Services Kenya Nairobi, Kenya Alex Njeru, Finance Director Key benefits • Automation and straight through processing. • Reduced risk. • Reduced costs. • Increased efficiency. • Improved payment visibility. Geoffrey Gursel, Citi, accepts the award on behalf of Population Services Kenya treasurytoday Adam Smith Awards © August 2018 | 17