The New Age of Cash Management
Business today moves faster than it used to, and progressive companies will not stand by idly while their banks use antiquated treasury services methods. Business customers now demand that their banks provide deposit imaging and other new functionality through their cash management systems.
One such company is Reynolds, Bone & Griesbeck (RB&G), a Memphis-based, regional CPA firm. The accounting firm used to send an employee to the bank almost daily to deposit checks, according to Patty Ervin, senior financial administrator, RB&G. That meant taking away from the productive time of support personnel, not to mention dealing with extremes in weather.
Further, mail delays sometimes made it difficult for the firm to arrive at the bank branch before the 4 p.m. deposit cutoff, relates Leslie Bouldin, RB&G's COO. During tax season, such holdups could mean delayed deposits of $50,000 to $100,000, according to Bouldin.
As a firm that works with its own clients' income and cash flow statements -- and that bills companies by the quarter hour -- RB&G was very cognizant of the wasted time and money resulting from manual deposits. So, when RB&G learned in the middle of 2005 that its bank, First Tennessee Bank (Memphis; $38 million in assets), offered clients the ability to scan checks for deposits remotely rather than physically bring them to the branch, the firm quickly adopted the new cash management functionality. "This is something I see as a huge benefit," says Jimmy Sawyers, RB&G's director of consulting, who works with smaller community banks as a consultant on their technology issues. "This is a killer application for cash management."
Since First Tennessee provides RB&G with benefits beyond deposit imaging -- including installment loans and lines of credit -- RB&G would not have considered changing banks to find one that offered remote capture, Bouldin notes. However, according to Sawyers, "If all other things were equal, [deposit imaging] would be enough to consider changing banks."
Once more, technology is proving to be a differentiator in an otherwise flattening market. "Cash management has been around for a long time; it's a very mature business," says Jacob Jegher, senior analyst with Celent Communications (Boston). "For years, it was a very strong cash generator for banks. But, more recently, that growth has slowed, so banks are looking at what they can do to innovate in this highly competitive market."
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