Value added features are key to a long-term Treasury Management Strategy for SMBs
by Max Koenig, VP of Sales & Ryan Johnson, Chief Customer Officer
The owners of Small and Mid-sized businesses (SMBs) face unique financial needs and challenges. Wearing many hats, the owners/management are forced to balance competing demands from customers, suppliers, employees, and partners to maintain and grow their business. Throw in researching changing customer needs, shifting competition, seasonal demands (taxes!), they often have little time to explore ways to optimize their business finances.
Correspondingly, owners often look to their bank to provide the right tools, capabilities, and insights to help them better manage their business. These solutions most frequently sit within banks’ Treasury Management (TM) teams whose main purpose is to to serve the needs of these businesses by offering, developing, and managing tools such as online banking portals, reporting, ACH, merchant services, and charge/corporate cards.
For larger clients, bank services often include customized advice and guidance from a dedicated support team, including Treasury Management experts. Unfortunately from SMBs, 1–1 personalized advisory experience is very challenging to deliver in person and at scale. Additionally, the “always on” demands on owners/managers leave little time to set up daily/weekly/monthly check-ins with their banking team. Thus, business owners all too frequently are unprepared when unexpected cash flow volatility impacts their business, leaving them vulnerable to dreaded working capital gaps that can sink otherwise profitable businesses. This impacts their banking relationships with credit availability harder to achieve during challenging times, much of which could have been avoided with predictive insight and coaching from treasury management experts.
Monit helps Treasury Management teams solve for this service gap for the small and business banking segments. The Monit platform ingests data directly from the businesses’ accounting platforms and, in turn, provides actionable insights, delivered via digital tools, tailored to their unique needs — at scale. Business owners have access to the same type of guidance previously only available to larger bank clients, but with the accessibility and availability that only digital services can provide. Comparably, this level of insight can help transform clients’ perspective of a “vendor” into a “trusted advisor.”
So how does this work?
Monit enables a persistent connection to a business owner’s accounting software, pulling in data from their general ledger. Augmented with additional alternative data sources, it then determines the total number of bank accounts and their balances, inflows & outflows, as well as forecast an aggregate cash position in the future. Owners then receive real-time insights on current and forecasted positions, recommended next best actions, opportunities to improve liquidity, reduce fees, and ultimately optimize decision making.
But wait there’s more! Business owners not only receive customized offers and insights, but are able to access embedded tools for scenario-based forecasting, late payment alerts, and support to request payments. Furthermore, they have access to industry benchmarking data, giving invaluable insight to how their business is performing vs. similar companies in their industry and home market.
Monit provides Treasury Management functions for community and regional banks to punch above their weight, giving them a competitive advantage and a differentiated offering from the standard suite of services. As for the user experience, the platform is fully white-labeled and embedded within the client’s digital banking experience. Supported by Single SignOn capabilities, it creates a seamless experience within browser and mobile channels, which in turn, drives higher levels of engagement — both in the number of times a client accesses their account and the amount of time spent per engagement.
By receiving an enhanced view into a business client’s financial information across providers, front line bankers and TM sales teams can accurately target and guide their clients to timely financial products. The bank can simply call Monit’s API to receive observations on their entire portfolio, individual clients, and further leverage the campaign builder tool to customize specific product offers to a focused population.
5 reasons why Treasury Management teams are partnering with Monit to deepen their Client relationships:
1. Optimize cash flow forecasting. Monit’s analytical tool ensures clients have the necessary amount of cash on hand to anticipate and address future working capital needs and while improving their current business operations. TM Officers receive an enhanced look into future cash positions which can be utilized to guide product recommendations to improve liquidity, financing, risk and cash utilization for their SMB clients. Understanding the total chart of accounts uncovers the whole financial picture and truly unlocks the operating cycle of a business. Our forecasting feature helps anticipate client purchases as well as refinance and expansion triggers.
2. Manage Payables. Understanding the timing of customer cash outflows includes understanding trade payable opportunities, financial commitments such as payroll, and all other payees of a company. Large outflows or changes in future payables (e.g., key new hire, large purchase) can be built into the forecast as “events,” giving the owner real time forecasts into future outflows. Streamlining payment processes not only saves an SMB money through improved processes (including optimizing the use of available bank services), it also helps to improve customer and vendor relations.
3. Manage Receivables. Unfortunately, one of the biggest threats to SMBs is failure to collect payments on time. Monit’s insight engine identifies scheduled, due, and overdue invoices and streamlines notifications to expedite this process. Additionally, the cash flow insights offer guidance to business owners to help reduce volatility and risk from cyclicality in receivables, thus improving their attractiveness as a credit borrower. Treasury Management teams, via Monit, thereby help achieve their client goals by improving and accelerating payments streams, identify new relevant payments services (ACH, card acceptance vs. paper checks), and ultimately improve their profile as a borrower.
4. Reduce Risk. Monit compliments Treasury Management by giving portfolio managers the best chance of success by optimizing their clients cash, receivables, investments, and associated risk. This includes understanding the liquidity position of “cash” and what functions in an organization affect liquidity. Treasury Management teams can then help optimize the right product mix for their clients.
5. Unlock Share of Wallet. Managing accounts across finance functions for SMBs can be complex. Providing an all-in-one dashboard can help boost business owners’ financial confidence and guide their conversations with the Bank. Monit compliments treasury management by giving portfolio managers the best chance of success by optimizing their clients cash, receivables, investments, and associated risk. Having greater insight to “share of wallet”, leads to a deeper relationship as tools and services are reviewed to optimize the operating cycle and cash flow forecasting to fund the business.
Businesses are increasingly demanding a hybrid approach to relationship management, with a mix of digital insight available on their schedule, balanced with advice and guidance that only a trusted advisor can provide. Bankers and Treasury Management teams that are able to aggregate the full view of their clients business, its opportunities, and obstacles will be uniquely positioned to deliver comprehensive guidance thus earning the right to remain as the primary “operating account.”
For financial institutions in the process of reinforcing their small business strategy, Monit offers the ability to deepen banking relationships and provide automated guidance at scale for the traditionally underserved SMB segment.
Reach out to learn more about how Monit is partnering with financial institutions to drive more growth!
About Monit
Monit is a Boston-based predictive intelligence technology company dedicated to the success of business owners and the banks that serve them. Monit’s founding team combines digital enterprise advice capabilities with real-world banking, small business, and regulated financial institution experience. Monit is privately funded with investment from TTV Capital, JAM Fintop, Runway Venture Partners, and Correlation Ventures. Learn more at www.monitapp.io and engage with Monit on LinkedIn.
Contact
Max Koenig, VP of Sales, Max@monitapp.io
Ryan Johnson, Chief Customer Officer, Ryan@monitapp.io
