What's the Proposition?

IBOS caters for the needs of corporate clients to:

  • Hold bank accounts around the world to pay and receive money
  • Have efficient processes around paying and receiving money
  • Effectively mobilise the cash balances held on the bank accounts
  • Manage these processes from within countries, from a remote location – or from a mixture of the two based on the customer’s management organisation and IT

The impact of the fulfilment of these needs is:

  • Speedier receipt, identification and mobilisation of funds collected
  • Better control of disbursements
  • Usage of funds from Trade Debtors – rather than overdraft or debt – to pay Trade Creditors
  • Shortening of the order-to-cash cycle
  • Reduction of Net Interest Expense
  • Reduction of amount invested in Working Capital

The trend towards centralisation and the efforts towards a Single European Payments Area (“SEPA”) may lead one to believe that it is feasible to streamline banking to the extent that bank accounts can be held in a single financial centre, in order to achieve the above objectives.

This does not correspond to today’s reality, either within the EUR area or outside it.

An IBOS offering is essential if the objectives are to be achieved, because:

  • Terms of trade in different countries force customers to use existing, domestic payment methods that are unlikely to be de-commissioned soon
  • Many such payment methods cannot be used unless the customer holds a domestic account
  • Legal and fiscal regulations force companies to hold bank accounts in the countries where they are registered
  • More countries are joining the liberalised-but-not-harmonised EU and eurozone (Poland, Hungary, Czech Republic…)
  • SEPA and other harmonisation initiatives have to solve these problems in order to realise itself, whereas IBOS has only to make it easier for customers to deal with the problems
  • Customer organisation and behaviour require a solution with accounts in different countries, even if Multinationals would like to centralise their accounting and processing into a single location

IBOS enables clients to use the domestic payments infrastructures of all countries covered, but to have a multi-country Cash Management solution in place that brings the in-country activity under one roof.

This is achieved without encountering two major stumbling blocks:

  • Routing local business through sub-optimal local banks because they just happen to be the in-country footprint of the Cash Management bank
  • Inserting an extra layer of accounts in each country, namely at the branches or partners of the Cash Management bank as an overlay or pass-through, to connect local activity with the regional scheme

IBOS achieves the full meshing of local (“retail” or “commercial”) activity with cross-border (“wholesale” or “treasury”) activity, avoiding the pitfalls.

Thus the customer’s two main objectives can both be achieved:

  • Efficient local processes
  • Efficient regional Cash Management