It is unlikely that the new calendar year will bring significant change to the ways companies think about managing their treasury operations, as economic uncertainty will continue moving into 2024. As businesses try to position themselves for stability amid rising costs in a high-rate environment, many are seeking out solutions rooted in efficiency and technology.

“The current economic backdrop poses significant challenges for companies that are trying to run their businesses efficiently,” said Emma Loftus, head of Treasury Management at PNC Bank. “It’s a setting where using technology in a way that helps drive efficiencies, and protects the security of your business, becomes more important than ever.”

Managing and Monitoring Liquidity

With access to credit more limited and more expensive in a high interest rate environment, it’s critical for businesses to have a firm handle on managing working capital. Higher rates can be advantageous from a deposit yield standpoint, but the key to maximizing liquidity hinges on businesses having clear visibility into their cash position. This is an area where automated payables and receivables solutions can offer benefits, as they can help businesses send and reconcile payments faster and more securely.

These solutions are components of an overall digital transformation process, which many businesses are embracing to help manage costs and create efficiencies. In addition to helping reduce time-consuming and error-prone manual tasks, digital platforms also can help realize efficiencies in payment processes. Additionally, they can help mitigate risk, both by implementing payment process controls and offering digital payment channels that reduce reliance on check payments. Finding ways to protect against check, and other forms of payment fraud, is an area of growing importance for businesses, as the threat of fraud is on the rise and projected to further grow in 2024.

Technology as a Tool for Transformation

The use of artificial intelligence (AI) is now part of any conversation related to innovative uses of technology, and this is likely to continue throughout 2024. Businesses are interested in having better, more flexible usage of their data, particularly as it relates to helping them manage treasury operations more efficiently.

While approaches to incorporating AI continue to develop, companies are also turning to other innovative tools to create transformative experiences. Embedded finance tools are growing in popularity, not only because they can help realize cost savings through streamlining digital back-office processes, but also because they can also improve end-user outcomes for clients. By integrating APIs (application program interfaces) and platform connectors into their websites or mobile apps, businesses can offer customers convenience and security, creating differentiated experiences and ultimately helping them drive revenue.

Embracing innovation will be essential to stability and growth in 2024, according to Loftus. “Businesses have to find ways to adapt to the pressures of the current economic cycle if they want to come out stronger on the other side. Technology is a path forward to do that, as is relying on relationships with industry experts who bring a complete understanding of client challenges and mitigating solutions that can help ease the burden.”

Ready to Help

PNC’s team of industry specialists is available to unlock business potential, navigate new technology, and overcome the challenges that come along with digital transformation. No matter the company's industry or size, PNC Treasury Management platform solutions are flexible in scope and geared towards driving measurable results and improving key performance indicators. For more information, reach out to your PNC Relationship Manager, or contact us.