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and a curse, as the management of the thousands of unique keys would require a database offset from the main blockchain system. Regulatory bodies have also indicated that they’re not all-too happy with the idea of the ledger being completely anonymous if checks need to be made. “The potential for blockchain is undeniable,” states Manocha. “Are we looking at a technology that has the power to remove all the middlemen that are party to a transaction? Will it kill the need for reconciliation? The answer is yes and no.” It is likely, he adds, that we will see the emergence of multiple blockchain ecosystems – one for clearing, one for settlement – that will bring reconciliation issues in their own rights, with each having its own messaging standards.


Despite these stumbling blocks, however, Oliver Wyman predicts that within the next 12-24 months we will begin to see capital markets firms invest in limited test cases and build industrial consensus. Just shy of the three year mark it predicts that small-scale application may start to appear in large players, too. For mass adoption the oft-used “ten years from now” figure is used – though how quickly things may take off after the first successful tests is hard to judge.


Treasury is often described as an industry that is reactive, rather than proactive – evolutionary, not revolutionary. In a Deloitte global survey conducted at the end of 2015, more than 70% of treasury CFOs marked liquidity risk management, efficient capital markets access and scalability as highly important issues for the coming year. What’s more, just over 50% noted that their biggest challenges would be the ability to patriate cash and to manage foreign exchange volatility. As more and more treasury departments shift towards technology at a rapid pace, selecting a catch-all suite of solutions as they go. SaaS cloud systems are the go-to, as data from Strategic Treasurer shows – 69% of the firms they asked were selecting or implementing a cloud-based workstation or management system, while 44% opted for trading platforms and FX portals.


As the rising tide of treasury needs continues to flood the market, some vendors have found themselves floundering in requests are orders, slowing down implementation processes. This had led firms to seek


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out vendors that offer a more modular approach – a treasury system that can bolted onto an existing core banking operation without too much intricate surgery. Connection to the outer world is now a crucial measure of a treasury system’s capabilities: data needs to be distributed throughout an organisation, while real-time reporting – often the dream of any CFO – is a reality in most treasury management systems.


So where can treasury head in the next few years? Deregulation is the name of the game, here. Crossing borders is still an issue – practices that work in theory often stutter when it comes down to the crunch. Controls on foreign exchanges in countries like China and India, for example, stop the netting of payments. Taxation programmes in Latin America block the concentrating of funds between financial institutions. It is critical, argue researchers at Treasury Strategies, that practitioners keep their eyes on the ball and monitor regulatory proceedings across the globe.


Jon J. Simone, Financial Markets Compliance expert at NICE, offers a different opinion on the sector. He tells IBS Journal that the cloud, Big Data analytics and blockchain are “the prescriptives that can be implemented right now” to solve regulatory problems but that ultimately many firms are “keeping their heads above water dealing with a tangle of technology in their operations – coupled with rising costs. You don’t solve regulatory and operational inefficiencies by just layering new technology over new technology.” Firms should think first about what their objectives are and what problems they need to solve before adding more tangles into their legacy systems. Compliance officers, Simone adds, need to enforce the culture of “I need to make the best educated decision on the right data, not all of the data.”


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