At first sight, one would think that managing banking fees present no major challenge. But the combined complexity of operating in multiple geographies and the inconsistency between regional practises and regulation means that this apparently straightforward issue can be a major challenge for treasurers and for banks. The growing focus on Consolidated Billing Reporting (CBR) is particularly timely.
By bringing a smart response to those who want more control over their banking fees, Bank Service Billing (BSB) standards continue to gain recognition in the cash management community at large and in particular with treasurers from corporates with a global reach.
Making sense of data
For starters, heterogeneous banking practises make it difficult to monitor, manage and therefore report on banking fees. “In a diversified banking landscape, treasurers need smart tools to make sense of all the data provided by their banking partners, especially since there is no harmonisation of the formats used”, explains Sandrine Le Goff, BNP Paribas BSB Reporting expert.
“It is getting increasingly hard to make sense of it all, so we designed a solution that improves, simplifies and streamlines the process of managing banking fees for corporates who have multiple banking partners and do business across the world”. Using BSB, treasurers can focus on more critical projects, and in today’s corporate environment, this is a must. Not only is their scope broader but it is also more strategic, and they are often expected to do more with less. So efficiency gains are the name of the game.
What I sign is what I get
A financial management tool, BSB responds to the needs of global corporates holding multiple accounts and relying on several banking partners. The solution provides an overview of all the banking fees that are supported by the corporate, offering the visibility that is needed to properly monitor and control banking costs and as a result, increase the cost-efficiency of the overall process.
Indeed, CBR contributes to reducing the time spent on data analysis. And while in some countries it is mandatory to provide detailed and consolidated banking fees, in others it is left to the goodwill of each bank.
A further benefit brought by BSB – and a considerable one- is that it allows both banks and corporates to ensure that their respective missions are fulfilled. “With BSB, we are all winners as the commitments made by both the banks and their clients can easily be verified”, adds S. Le Goff. The French financial newspaper Les Echos estimates the gap between the fees negotiated by both parties and the actual banking fees billed to treasurers to be between 5 and 10%. And as such fees are usually debited directly from the corporate account, it is rather complicated to rectify.
Harmonisation: yes we can
Banking fees coming from different banks and different countries in different formats are virtually impossible to control. With CBR, harmonisation is made possible based on the use of the TWIST BSB and ISO 20022 camt.086 formats. In addition, the flexibility brought by XML means that CBR is as valuable to a large retailer as it is to a B2B corporate with an international scope, providing transparency and control but also the opportunity to benchmark the offers of different banks.
All in all, BSB is the smart tool that corporates expect and deserve. Besides, the momentum was initiated by the market, first by General Electric in the United States, then in France and Germany by leading companies that have officially addressed their banks with a clear message: as regards banking fees, let us know what is what and let us see matters more clearly. A message successfully delivered.