| | DEC-JAN8CIOREVIEWAPAC.COMA recent Instagram shared by one of my friends: "I have not used cash for almost a year with COVID. When the clinic told me they do not accept mobile payment, I told them I don't have offline money. I forgot the word CASH!" Isn't it awakening that digital payment is no longer an optional service, yet a mandate? Or you will lose the whole generation Z as a customer base. No doubt that the electronic payment system has been and will be further disrupted. However some of the finance veterans in B2B world would sneer at the imprudence of the consumers. As security is always the #1 factor in B2B payment. And we will never compromise security for speed of transaction, lower cost, and easier access to financial services. For corporations, fintech companies are risky in security while traditional banks are lacking the customization, speed in transactions; cost efficiency, user friendliness etc. Don't blame corporate finance function to be old-fashioned. We are just prompted with no good choice. My favorite quote on this is that we are "grappling with a stark disparity between the nimble opportunism of cybercriminals and the lumbering lead times of the security protocols." We are still waiting for the secure and instant payment solution with robust reconciliation that consumers now take for granted. A global infrastructure capable of supporting instant payments will take time to be implemented. While it becomes less remote when we see the possibility of a collaborative platform with traditional bank working on back-end operations with infrastructure security, regulatory compliance etc., and fintech on the front-end with agile data retrieval, personalized services and flexible services. The current scenario amidst Covid-19 has also become a catalyst to drive the cooperative opportunities between banks and fintech companies given the negative interest rate, lots of focus on liquidity, less offline interaction etc. It's no longer a "To-Be" or "Not-To-Be" question. Corporations just want to be followers, to invest in proven technologies, rather than brand-new ones. When that's solved, let's talk about what we could get out of the new payment solutions. Believe me, it's more than shifting to a new platform:1) The imminent benefits go beyond speed of transaction. Exponential volume growth and visibility to such transactions will be game-changing in price setting in terms of interest, foreign exchange rate, service fees and any transaction cost. Even more importantly, a more rationalized pricing mechanism will optimize the match of demand and supply, which is the ultimate goal of financing. 2) For renewal of loans, corporation will no longer to submit financial reports at annual basis. The digital payment platform should know better than you whether you meet the covenants. The visibility of cash movement and the network among which it moves will provide enough intelligence to decide when to increase, decrease or revoke credit line for the clients.3) In a foreseeable future, accounting could be automated in such platform with some of interface for the accountants to select depreciation/amortization transactions and to provide according ARE YOU OFFLINE?By Elyn Chen, Group CFO, Laird Performance MaterialsElyn ChenIN MY OPINION
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