An Evolving Payments Landscape

Treasury and Trade Solutions 2 The role of treasury Some of the world’s largest companies are significantly expanding their consumer offerings as an alternative to conventional distribution channels. These companies are seeking to manage and own the customer experience, maintain brand integrity, build lasting relationships, and deepen their customer insight. In the past, direct-to-consumer was seen as viable only in specific market segments. Now, it is being introduced in sectors such as mainstream food and beverages that were previously considered too challenging. To deliver a winning consumer experience, companies need to plan their strategy carefully and look at the challenges from a holistic perspective, encompassing merchandising, marketing, investment, sales and other functions. Given the importance of payments for eCommerce, treasury is increasingly important to delivering the overall experience: to make a sale, it has to be easy for consumers to click the buy button. To remove potential friction, considerable planning and research on consumer behavior and preference is required. Finding the right partners can make a big difference in terms of shortening the learning curve and creating a better experience for consumers. It is also essential for treasury to be involved at an early stage to help ensure that cost-effective payment processes are built into any strategy. Treasury must play a strategic role if eCommerce is to deliver value for the entire organization. Treasury can add significant value by choosing the right bank and bank account structure to mitigate risk. It can play an important role in establishing relationships with acquirers. Treasury also needs to be involved in managing settlement, FX exposure, and associated risks. In particular, given its expertise, treasury should be involved in designing and implementing the checkout experience for the organization, which has a direct impact on the customer’s overall experience. Within the organization, treasury is likely to have the best understanding of the local payment landscape and the local regulation. It also has relationships with banks and can therefore source insights and best practice and bring that information back to the commercial and business organization. Given the centrality of treasury, it is becoming more common for treasury to have a digital lead who looks at eCommerce. Globalization and the future of eCommerce Consumers want the world and thanks to globalization and smartphones, they can now have it. It is indisputable that globalization has delivered economic growth for many decades while giving consumers greater choice, quality and convenience. In recent years, there has been growing tension between globalization and protectionism. But while there may be political pressure to buy local, in many aspects, globalization is accelerating, with many national businesses seeking to internationalize rapidly. Treasury can add significant value by choosing the right bank and bank account structure to mitigate risk.