Empowering Nonprofits: Transforming Treasury Operations with Modern Technology

Written by Sergio Garcia
February 2, 2024

Cash management for a nonprofit organization is one of the most important elements for its success. It’s a vital component for organizational resilience and continuity. Not only does it fulfill compliance requirements, but it also plays a crucial role in achieving the organization’s mission. 

By actively monitoring cash flow, nonprofits gain visibility into their financial health and can use that data to make informed decisions for resource allocation, budgeting, and planning. Additionally, tracking cash flow enables organizations to get ahead of potential challenges and take actionable steps to mitigate risk in non-profit treasury management.

Despite its importance, many treasury teams in non-profit organizations face manual, labor-intensive processes for bank reconciliation, reporting, and forecasting. This results in hours spent weekly logging into multiple bank portals to collate data. Rigorous quality assurance checks, and limited time to spend analyzing data to glean meaningful insights.  

In fact, according to a recent Non-Profit Trends Report from Salesforce, only 36% of nonprofit leaders admit they are “highly satisfied” with the technology that helps them do their jobs, and less than half of those surveyed say they are actually able to make quick strategic decisions. 

So how can treasury professionals in non-profit organizations overcome these challenges and implement emerging technologies to streamline their operations? In this article you’ll learn practical applications for emerging technologies such as APIs, AI, and machine learning to help automate operations.

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Getting Started with Treasury Digital Transformation in Nonprofits

Digital transformation is essential for nonprofits to thrive in the modern landscape. Cloud-based software, advanced reporting tools, and seamless collaboration empower organizations to reduce costs, enhance productivity, and focus on their core mission.

It’s not surprising that 74% of non-profit leaders view digital transformation as essential. Technology is also viewed as vital to nonprofit work. Three quarters (76%) of those surveyed say employees recognize technology as a critical part of their success. Additionally, 73% reported they rely on data to inform their decisions. 

Initiating digital transformation within your treasury operations involves assessing the efficiency and productivity with your current process, followed by a customized plan tailored to the unique needs of cash management workflows such as bank reconciliation, weekly reporting, and cash forecasting. 

From there, identify solutions that can automate these repetitive tasks, freeing up your team to spend more time on analysis rather than data collection. The goal of digital transformation should be to streamline processes, improve workflows, reduce costs, and deliver greater value.

Tech Innovations Transforming Non-Profit Treasury Management

Three key technological innovations are transforming treasury operations, specifically in the insurance sector, making cash management more efficient and secure.

Cloud-Native Cash Management

Cloud-native platforms enhance collaboration providing a single source of truth for financial information. Furthermore, with everyone working on and accessing the same dataset, the likelihood of emails going to the wrong recipient or attaching the wrong cash report is eliminated. Executives can make decisions confidently, free from concerns about relying on outdated spreadsheet versions, and the risk of data loss due to employee turnover is minimized.

This ensures that everyone in your organization has access to a unified source of truth. It offers a singular platform, a consolidated dataset, and a unified set of forecasts, fostering seamless collaboration with access controlled through customizable permissions.

Open Banking APIs

Open banking APIs paired with cloud-native technology provide a direct, consolidated banking data feed accessible from anywhere, eliminating manual cash consolidation processes. Real-time accuracy is ensured by linking financial data from multiple institutions into one centralized dashboard.

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The conventional approach to gathering and organizing financial data has been an incredibly time-consuming process. A team member would need to log into each banking portal individually, export the financial data as a .CSV file, and then consolidate this information from various banks and accounts owned by the company.

This task, particularly in the non-profit sector, can be substantial.

This series of steps typically consumes 15 or more hours per week, and by the time it’s completed, the data is already outdated.

With APIs, non-profit organizations can now seamlessly connect their financial data from multiple institutions to a centralized dashboard. This connection establishes a data feed that offers 100% accurate information in real time.

No more worries about transcription errors or mistakenly copying and pasting wrong line items. It serves as a direct reflection of your current financial data, allowing for consolidation and a comprehensive view in one place, completely eliminating the need for manual intervention.

AI in Treasury Operations

The integration of generative AI has revolutionized the role of treasurers, enabling detailed data mining and advanced analysis on the financial data at their disposal. Non-profit treasurers, regardless of their technical proficiency, can ‘interrogate’ their data for a deeper understanding of events and reasons behind them.

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For instance, if you’re puzzled by the accelerated depletion of cash reserves in a specific subsidiary, you can turn to Trovata AI for answers. It can sift through financial data, flagging anomalies to help you pinpoint the underlying reasons. Similarly, if you’re contemplating acquiring a new subsidiary and want to gauge its impact on overall profitability, Trovata AI can construct a scenario model. 

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This model takes into account potential changes in gross revenue, as well as variations in holding and finance interest costs, providing valuable insights into the potential outcomes.

Achieve Your Organization’s Financial Mission Goals with Trovata

Just 12% of nonprofits are “digitally mature”,  and they’re 4X more likely to achieve mission goals. Non-profit companies can harness the power of modern treasury technology to revolutionize their operations. 

Embracing digital transformation, leveraging cloud-native platforms, open banking APIs, and incorporating AI-driven solutions like Trovata can significantly enhance efficiency, accuracy, and strategic decision-making.

In a rapidly evolving digital landscape, staying at the forefront of technological innovation is essential for success. By embracing these technologies, treasurers can lead their organizations towards a future where efficiency, impact, and innovation go hand in hand.

If you’d like to see how Trovata can improve your nonprofit’s cash visibility, bank reconciliation, financial forecasting, scenario planning, and more, consider booking a demo today. The journey towards a digitally transformed treasury operation awaits, unlocking new possibilities for nonprofit organizations to fulfill their mission with maximum impact.

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