Rien que pour vos flux : La payment factory et les comptes virtuels au service des transferts pour compte de
From SEPA compliance to benefits COBO Payment On Behalf Of POBO SEPA benefits Central Payment Processing Platform XML SCT SDD SEPA compliance 1
From SEPA compliance to benefits Step 1 COBO Payment On Behalf Of POBO Central Payment Processing Platform Technical benefits Systems XML SCT Central/offshore accounts SDD SEPA compliance 2
31.03.2014 2010 DB Blue template Central Payment Processing Platform Entities Reporting? Entities Treasury Workstation ERP(s) ERP Payment factory/ middleware SWIFTNet connectivity SWIFTNet Entities Entities Security Control Data verification 3
info info info info info Cash flow reconcilement challenges Typical receivables management issues Description Breakage Point 1 2 Limited reference information provided by paying banks Limited reference information provided by the clearing system Payer Payer Bank Payer Bank Clearinghouse Beneficiary Bank Beneficiary Bank SEPA End to End reference 140 characters remittance details 3 Lack of reference information from payers Payer Payer Bank? Beneficiary Bank 4
Confidential & Proprietary Accounts Receivable Manager Efficiency gains in reconciliation Description Payment Bank account(s) Virtual accounts Access 1 2 Payment initiated, received in favour of the VA Identification of corresponding bank acct & booking to that acct Payment receipt 1 Virtual a/c Virtual a/c eg VA 1 4 Virtual a/c 3 Acct statement is uploaded - SEPA payments are automatically assigned 2 Bank a/c 3 eg VA 2 Virtual a/c 4 Acct statements accessible eg VA 3 5
Automated reconciliation and visibility Physical Account Business A Business C Business B 6
Structure of virtual account number DE 12070070 [CID] _ Country Code Check Sum Bank Code Customer ID Virtual Account Number The Customer ID is provided by and is constant for all of your Virtual IBANs The Virtual Account Number section follows the Customer ID and is the unique identifier created by you The two positions after the country code are the check digits. These are based on the other elements of the Virtual IBAN 7
From SEPA compliance to benefits Step 2 COBO Payment On Behalf Of POBO New operating model Central Payment Processing Platform XML SCT SDD 8
POBO vs POBO Processing On Behalf Of Subsidiary payment processing is managed centrally (eg Shared Service Center) Subsidiaries have third-party bank accounts Payments are cleared through each subsidiary s third-party bank accounts Subsidiaries view their cash balances and reconcilement date via their third-party bank accounts Payment On Behalf Of Subsidiary payment processing is managed centrally (eg Shared Service Center) Subsidiaries do not have third-party bank accounts Payments are cleared through the IHB s third-party bank accounts Subsidiaries view their cash balances and reconcilement date via their IHB bank accounts 3/31/2014 2010 DB Blue template 9
Streamline accounts Before SEPA Multiple accounts for EUR payments and collections in different countries After SEPA POBO Single central account for EUR payments and multiple accounts for collections in different countries CANARY ISLANDS CANARY ISLANDS SEPA countries 10
Payment on behalf of /Treasury Center / In-house Bank For those services provided by the IHB, the subsidiaries of the company utilize the IHB for their banking needs in place of third-party banks For example: Subsidiaries open bank accounts with the IHB Subsidiaries process their payments via the IHB IHB processes intercompany payments within the IHB IHB utilizes third-party banks to process external payments Subsidiaries borrow and invest with the IHB IHB provides subsidiaries with bank account statements Challenges: ERP and TMS systems alignment Account ownership Intercompany agreements 11
New operating models Impact areas for Corporates Handling of non SEPA payable and receivable products; legacy domestic payment / collection products that are not substituted by SEPA, eg LCR collections, RIBA collections, einvoices Additional optional services of local ACH, eg Clearing cycles, Cut-off times, Remittance information Legal and Tax, cf. next slide Corporates with in-country specific transactions in Europe will still need to open local accounts 12
New operating models Impact areas for Corporates Legal Payment service directives, ie legal & regulatory requirements for a legal entity providing this service to the group, ie how to define the service that the legal status of the service providing units is not impacted, eg banking license Local legal restrictions concerning POBO & COBO Central Bank Reporting Requirements Local receptions to REG 260 ie local regulations/ requirements for local accounts, eg TAX payments Italy Requirements of freeing the debtor of its debts Notification requirements of the corporate to the clients Documentation requirements; one-time & transactional Requirements to make client's counter party payments insolvency proof Adjustments to direct debit mandates (open direct debit mandates) and / or trade contracts 13
New operating models Benefits value creation for Corporates The potential benefits of implementing a POBO structure: Improve operating efficiencies and automation Increase visibility, control and security Further rationalize banks and bank accounts, ie external bank accounts are replaced by internal accounts Reduce banking transactions, borrowing and total relationship cost Replace time intensive account maintenance processes by internal SLA maintenance processes Process consolidation & standardisation Commercial benefits Increase purchasing power Harmonised fees Simplified Liquidity management 3/31/2014 2010 DB Blue template 14
From SEPA compliance to benefits Step 3 COBO Account streamlining Payment On Behalf Of POBO Central Payment Processing Platform XML SCT SDD 15
After SEPA POBO and COBO Clients need a single account for making EUR payments and collections CANARY ISLANDS SEPA transactions SEPA countries 16
Case Study Objective 100 % In-house bank Situation Find collection solution for entities in 4 countries short term due to drawback of bank in countries (Baltics) and counterparty risk (Finland) Entities already linked to IHB for Pobo Objectives Use internal account for collections instead of opening a new external account Entity IHB / Payment factory Group Vendors Entity IHB / Payment factory Group Vendors Customers Customers 17
Case Study Objective 100 % In-house bank Analysis Drawback IHB process needs to cover all transaction types (incl. salary, tax, non-erp payments) How addressed Adjust scope of PF system, add new functionality Regulations Due diligence with stakeholders (Finance, IT, legal & tax, auditors, banks, regulatory bodies) Notification of client Review all correspondence generated in ERP (Invoices, payment advice) Identification of beneficiary Virtual bank accounts Full Cobo solution implemented for 3 out of 4 countries and next country under review 18
What is doing to assist clients LDD/TDD Project Legal and Tax Due Diligence in 52 countries Intelligence to assist clients Advisory Sessions White board sessions with POBO/COBO stakeholders within clients Knowledge to assist clients Product Development Product enhancement for POBO/COBO structures Capabilities to assist clients 3/31/2014 2010 DB Blue template 19
Contacts Yvonne Hutzler Director Cash Management Corporates 23 avenue Franklin Roosevelt 75008 Paris, France Tel: +33(1)4495-6503 e-mail: yvonne.hutzler@db.com Jens Mikolajczak Managing Director Co-Head Cash Management Corporates EMEA Adolphsplatz 7 20457 Hamburg, Germany Tel: +49(40)3701-3799 e-mail: jens.mikolajczak@db.com
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