Improving the Offer-to-Bill Cycle: How Middleware Platforms Can Transform Corporate Banking
SunTec Business Solutions
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Winds of change are blowing over the once staid realm of corporate banking. Modern customers demand real-time insights into their accounts and on-demand, seamless services. And they now have a plethora of options to switch loyalties to, as fintechs and neo banks make rapid inroads into the corporate banking space. A corporate bank must now extend its digital transformation efforts beyond customer-facing functions to back-end systems and operations. They must do so while balancing the risks that come with any core transformation efforts.
Evolving Customer Expectations
A lot is spoken about retail customers and their expectations from their banks. But what do corporate customers want? To begin with, they want to be able to manage their liquidity and improve their cash forecasting capabilities. According to our survey in collaboration with the American Banker, 49% said accurate cash flow forecasting is important but only 38% banks fully meet client needs.
To achieve this, banks need real-time visibility into account balances and the ability to carry out cash forecasting across regions, currencies, and time zones.? Further, compliance becomes important, as is integration with networks like Automated Clearing House (ACH) and third-party payment options.? Corporate customers also want instantaneous payment processing, error-free billing, transparent pricing, and seamless contract renewals. And last but not the least, much like their retail counterparts, corporate customers too want personalized, relationship-based engagement and operational efficiency.
Complex Cash Management Challenges
But what is holding back banks from delivering the kind of service and engagement that clients want? There are some significant challenges and factors that they may need to address:
·?????? Customer Diversity: No two customers are the same, and banks must understand every customer’s unique requirement and offer them the solutions and services they need.
·?????? Process Complexity: Cash management is a complex process with multiple data sources like invoices, forex transaction details, and multi-account structures across geographies and institutions. Cutting through organizational silos to consolidate these details for an efficient order-to-bill process can be challenging.
·?????? Deal Profitability: It is crucial to streamline the offer-to-bill cycle to prevent revenue leakage on deals.? Banks must also be able to understand the customer’s overall relationship with the bank and be able to objectively compare possible discounts, pricing, etc. against customer commitments to ensure the deal is profitable and benefits both parties.
·?????? Commitment Tracking: Customer commitments must be tracked throughout the contract term to ensure that they keep up with the terms they had committed to when the deal was finalized. This is crucial for plugging revenue leakage and ensuring a frictionless and mutually beneficial contract renewal.
·?????? Billing Errors: Errors in billing, inadequate dispute resolution, and outdated contracts may cause revenue leakage and negatively impact customer satisfaction and loyalty.
·?????? Renewals: Outdated contracts carry significant risk of revenue leakage as customers continue on terms that may no longer be applicable to them. Banks need the right tools for tracking renewals, ensuring renewals are carried out in a timely manner, managing commitments, and ensuring sustainable profitability.
·?????? Legacy Systems: Most banks have been on a transformation trajectory for a while, and they have made some progress. But many of them may still be working with foundational but fragmented legacy systems for treasury processes, and these lack the agility needed for unifying processing, leveraging customer data or delivering personalized experiences. Most banks are hesitant to replace these systems entirely, as the process is expensive and highly risky.
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How Middleware Platforms Can Transform the Offer-to-Bill Process
What if banks could modernize corporate banking processes without touching the legacy core? Now they can by simply opting for cloud-native, microservices-based middleware platforms to augment their core systems. These systems abstract customer engagement functions into a horizontal enterprise layer, enabling easier integration of new technologies and features. With such a middleware platform in place, banks can ensure operational agility, seamless scalability, and personalized strategies without overhauling legacy cores. Middleware-driven offer-to-bill platforms provide real-time cash flow visibility, enabling better liquidity management, forecasting, and financial planning. They can integrate data to present consolidated information on customer engagement, provide personalized pricing insights, and improve the billing and dispute resolution processes.
The right offer-to-bill solution can help transform a bank’s corporate banking business. For example, a 150-year-old European bank was operating with a legacy core banking system that hindered efficient pricing and deal management. They relied on manual processes leading to significant revenue leakage, while the legacy system could not handle complex deal management and multi-currency transactions. They were unable to implement specific customer segment pricing, resulting in inconsistent statements and dissatisfied customers. They deployed a powerful middleware offer-to-bill solution to modernize processes and consolidate critical data for deal management and pricing. This enabled accurate pricing models, streamlined offer management, and improved billing accuracy through consistent payment cycles. As a result, the bank saw a significant decline in customer disputes and improved customer satisfaction.
Data-Driven Banking and Agentic Automation
Effective use of data is key for corporate banks as they move to customer-centric models. And to make the best use of data, they need advanced analytics and artificial intelligence (AI) powered solutions. AI can help analyze vast volumes of transactional and behavioral data and use predictive capabilities to help banks to deliver improved cash flow forecasts, understand customer requirements, and deliver customized solutions. With real-time analytics, treasurers can better manage liquidity, evaluate risks, and streamline decision-making. Interestingly, banks can also leverage AI to identify process or operational inefficiencies like billing inaccuracies, or friction in the payment process and take quick action to rectify them.
Emerging AI models can further enhance offer-to-bill solutions. Agentic AI, for example, can employ autonomous agents to automate workflows across quoting, contract management, invoicing, and cash collection. This approach can minimize human intervention, streamline operations, and reduce billing errors. By integrating such technologies, banks can transform their offer-to-bill capabilities into a future-ready, customer-centric foundation.
In today’s hyper-competitive landscape, a corporate bank must reengineer their strategies to ensure customer satisfaction and profitability. Pricing and billing are key differentiators and investing in advanced offer-to-bill platforms to deliver personalized solutions and engagement is no longer optional. What are some of the strategies your bank has deployed to transform and modernize corporate banking and improve revenue management and customer loyalty? Share in comments below.
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