The Association for Financial Professionals (AFP) 2023 annual conference brought together a vibrant community of finance professionals, industry leaders, and partners. Over the course of four days in San Diego, we celebrated achievements, explored emerging technologies, and collaboratively looked ahead at the future of the industry. To that end, we’ve compiled the top 4 things we learned at AFP 2023.
The atmosphere of the conference truly embodied its theme – “Where Bright Ideas Shine”. The conference served as a gathering of innovative minds and disruptors who are rapidly evolving the finance industry. In a world of relentless change and digital transformation, the event highlighted the need to holistically rethink finance operations to keep pace with the heightened demands on financial analysis.
As a disruptor of treasury management, we were thrilled to participate in two panels over the course of the four day event. Our aim was to enlighten finance professionals about the transformative potential of banking APIs, automation, AI, and how these revolutionary solutions can empower treasury teams to take their game to the next level. However, we didn’t just bring insights; we were equally attentive to the wealth of knowledge shared by industry experts, our valued customers, and partners. This two-way dialogue is pivotal in our efforts to navigate and catalyze the ever-evolving landscape of finance. We’ve compiled our top takeaways from this remarkable event, where we had the privilege of speaking and listening to thought leaders and industry experts.
1. If You Haven’t Already Transformed Your Treasury Operations, You’re Already Behind
The finance industry is in the throes of a momentous upheaval, all courtesy of the digital transformation wave. While this theme isn’t new, what has changed is that technology has rapidly evolved in the last few years and is already changing the way finance teams operate. Automation, AI, and APIs took center stage as recurring themes at AFP 2023, underscoring their pivotal role in reshaping the financial landscape. The profound impact of recent global events has intensified the demand for business resiliency and agility, prompting organizations to expedite their digital transformation initiatives at an unprecedented velocity.
In fact, the pandemic acted as a catalyst, propelling digital transformation forward by a staggering seven years, both at the business and industry levels. For finance professionals, this translates to a stark reality: if you have not already harnessed cutting-edge technology to revamp your processes, you’re essentially trailing behind in the race toward a digitally-driven future.
Consider this, an Accenture report indicates that 76% of banks worldwide expect open banking API use and customer adoption to increase by at least 50% over the next three to five years. This statistic alone underscores the rapid transformation occurring within finance. APIs, for instance, have already begun to evolve, giving rise to innovative solutions like API payments, a topic we’ll delve into further. Powerhouses such as J.P. Morgan, Wells Fargo, PNC, Bank of America, and more are offering APIs as a progressive and secure solution to create new efficiencies. The wheels of change are in motion, and the finance industry is embracing these transformative technologies with open arms.
Modern treasury management software combines these emerging technologies, revolutionizing real-time data consolidation into one unified platform. This ensures a single source of truth for modeling, analysis, and forecasting.
The implementation of APIs not only simplifies the process of providing precise forward forecasts, but also enhances their accuracy. This creates the opportunity for finance teams to grow into strategic pillars of business growth.
The turbulent events of the past year have had a significant impact on finance operations. Check out our latest episode of Fintech Corner to learn how new technology is empowering finance teams to respond.
2. APIs are Evolving Finance Beyond Risk Mitigation to Strategic Decision Making
34% of CFOs desire a single source of data, highlighting the importance of data consolidation. The sheer scale of digitization in business and finance makes it impossible to rely on traditional treasury processes. The workload has surged, and unless you leverage technology for automation, the answer to increasing your team’s headcount for tasks like reconciliation is likely a resounding “no.” However, as you pivot towards more value-added tasks, the conversation shifts.
Embracing technology, driving automation, and shifting to a data-centric, API-driven world are at the heart of this shift. We’re seeing the convergence of various financial functions such as accounting, FP&A, and treasury moving closer together within the corporate finance group to provide more strategic insight from financial analysis. As more teams adopt modern solutions, the synergies across these departments promise exciting developments towards a more strategic and proactive approach to financial analysis, all underpinned by a unified core of data. Michael McKenna, Vice President at Robert Bosch Finance, shared a real world example of this in one of the many sessions at AFP 2023.
“Trovata was able to come in and have the bank connections that we needed to really get the data we needed. They were able to put together dashboards that we needed to communicate with our home office in Germany.”Michael McKenna, Vice President, Robert Bosch Finance, LLC
Modern treasury management software breaks down the silos that have existed between these teams for far too long, enabling all users within to have access to a unified repository of information. It’s a game-changer that ensures everyone is on the same page, empowers finance teams to make necessary amendments while maintaining a comprehensive history of changes, and simplifies the process of sharing and analyzing critical financial data. Through cutting-edge technology, finance teams are empowered to gain far deeper, strategic insights that add value.
3. API Based Payments Bring a New Level of Efficiency
Earlier we mentioned API payments as an example of how APIs are quickly adding new efficiencies to finance functions. When it comes to API-based payments, the financial landscape is experiencing a remarkable transformation that sets it apart from traditional payment methods.
This shift is truly exciting, particularly because many of the world’s largest banks are wholeheartedly embracing it. What makes API-based payments so groundbreaking is the fact that it completely redefines how financial workflows operate and how we’ve traditionally conducted our financial affairs.
API-based payments essentially grant direct access to the bank’s payment infrastructure through a publicly accessible API. This interface allows customers or authorized providers to connect directly to the bank and process individual payments or files without the need for intermediaries. In essence, it eliminates the presence of middleware, streamlining the payment process in a profound way.
Over the past 15 to 20 years, there has been significant innovation in third-party payment ecosystems, with a plethora of companies offering payment solutions. However, banks have always been at the core of payment provision, even in these third-party setups. They have handled payment settlements and processing. Now, with the advent of API-based payments, a new era dawns. Banks are not only permitting their customers but also third-party entities to directly access their payment infrastructure via APIs.
This shift has profound implications. Just as Amazon transformed the world of direct consumer transactions and supply chains, API-based payments are revolutionizing the financial ecosystem. The direct connection between customers, third parties, and the bank through APIs streamlines and simplifies financial transactions, addressing numerous pain points in the current financial landscape. The advantages of this shift are nothing short of game-changing, promising to reshape the way we transact, manage payments, and conduct business in the financial world.
4. The Responsibilities of CFOs and Treasurers Have Transformed
For as much as technology is transforming the industry, we cannot forget the importance of the human element. The roles of CFOs and treasurers have expanded significantly in recent times. Their responsibilities now encompass a broader spectrum, ranging from business intelligence to predictive analysis and data management. This transformation reflects the changing dynamics of the finance sector, where professionals are required to possess a new set of skill sets and competencies.
Finance is moving away from being primarily operational to becoming a strategic powerhouse in the organization. This transition is driven by the need for finance professionals to adapt to the rapidly changing landscape, utilizing their expertise, experience, and knowledge in harmony with technology to achieve a new level of business intelligence.
While solutions such as AI have emerged as buzzworthy powerful tools in the finance industry, it’s essential to recognize that they are not standalone solutions. They rely on the human component to effectively interpret and apply its insights. The synergy of technology and human expertise is at the heart of delivering this new level of business intelligence, making it clear that new technology is most potent when complemented by the skills and insights of finance professionals.
Transform Your Treasury Management with Trovata
AFP 2023 was a testament to the exciting changes taking place in the finance industry. The event’s focus on digital transformation and the growing responsibilities of finance functions showcased the industry’s evolution. We had an incredible time engaging with attendees over the course of the event making it an experience to remember.
As we move forward in this era of innovation, embracing technology, and reimagining the industry, we’re excited to continue helping finance teams transform treasury management in this new landscape. With Trovata you can gain unmatched visibility of cash daily across all accounts, empowering you to better understand liquidity to make the most out of excess cash. Aggregate, search, tag, analyze, forecast, and report; gain everything you need to make smarter, faster decisions. Elevate your business’s financial operations with Trovata’s superior tools today.