SAP Corporate Connectivity

SAP Corporate Connectivity Financial Services Network In partnership with

SAP Product Strategy 4 On Device 3 All devices All user experiences Easy to extend Orchestration LOB On Demand On Demand SAP Business Suite 7 On Premise SAP Business ByDesign 2 1 Instant value LOB or Suite Integrated to on premise SOA enabled Best practice packages Non-disruptive enhancements 2011 SAP AG. All rights reserved. 2

NETWORKED SOLUTIONS CONNECTING THE VALUE CHAIN RESELLER CLOUD CLOUD CLOUD SUPPLIER Integration across business networks Consistency across multiple solutions Stepwise migration to cloud computing COMPANY 2011 SAP AG. All rights reserved. 3

Banks and Corporates want Value-added Apps to Facilitate Financial Supply Chain Processes Credit management Check creditworthiness Issue invoice Forecast cash Trade Finance Finance working capital Resolve disputes Payments & Cash Collect cash Settle & pay Electronic bill presentment and payment Reconcile Corporate demand for applications to facilitate treasury management interactions between corporates and their banks. Cash and liquidity management FX Treasury & Hedging options Outsourced Payroll Post-financial crisis priorities: Hedging counterparty risks via multi-bank relationships Cash management managing liquidity, maximizing working capital, trade services, etc. Up-to-the-minute visibility and real-time bank-to-corporate transactions to operationalize these priorities Upper-mid to mid-market corporates are the bread and butter target market for most corporate banks. (Source: Financial Insights, 2010) 2011 SAP AG. All rights reserved. 4

Key Trends and Issues Key Developments in Corporate to Bank Connectivity Corporate to Bank Connectivity is a key part of strong customer relationship in transaction banking Corporations have evolved from focusing on operational efficiency to competitive differentiation in an interconnected and interdependent business environment, defined by: A holistic view of their financial supply chain A clear understanding that efficient business networks within and beyond the borders of an enterprise can be a source of significant and long-term competitive advantage Banks have a clear opportunity to differentiate their services through innovative solutions that recognise and meet these challenges But Service platforms that enable deep connectivity across the financial supply chain can be cumbersome and on-boarding of corporate customers to such platforms can be slow and complex Traditional applications are often too inflexible for fast-changing business processes Implementing new processes takes too much time and is too costly The corporation faces operational and financial risks due to manual workarounds, lack of transparency and less knowledge of working capital. 2011 SAP AG. All rights reserved. 5

Key Trends and Issues Top corporate concerns Long Customer Implementation Corporates need to carry out development to comply with bank s delivery requirements Complexity of global payment formats, requirements and gateways Reconciliation of AP and AR Reconciliation often very manual Reconciliation details often missing Transaction Visibility and Control Complex architecture: difficulty meeting compliance, manual workarounds, multiple failure points Lack of transactional transparency Difficulties in managing working capital 2011 SAP AG. All rights reserved. 6 SAP 2008 / Page 6

Key Trends and Issues Weak Spots in Corporate to Bank Connectivity become... High operating costs for servicing multiple corporate customers Long on-boarding due to the rigidity of existing formats and gateways Time Cost Corporation A BANK Connectivity Platform Connectivity Platform 1. Development needed to comply with bank s delivery requirements Hindered innovation: inability to create customer-focused, fast-to-market products and services High acquisition cost of SMB customers SME A Connectivity Platform SME B Connectivity Platform SME C Connectivity Platform Corporation B Connectivity Platform 2. Lack of visibility impacts real-time knowledge of working capital and affects operational and financial risk 1. Inefficient to operate a direct connectivity platform 2. Services and processes usually designed for large enterprises 2011 SAP AG. All rights reserved. 7

How are we currently helping solve the missing links.. Bank Communication Process Flow SAP ERP SAP Bank Communication Management SAP NetWeaver Process Integration Execute Payment Program Create Payment Order Import Bank Statement Post/Processing and Clearing Create Batch Payment Approval Work List Security - Approval workflow - Authorization - Digital signature Receive Status Messages Bank Statement Routing Mapping Security Encryption Digital Signature SAP Integration Package for SWIFT Resource Adapter SWIFTNet SWIFT Alliance Access / Gateway 2011 SAP AG. All rights reserved. 8

SAP Offers a Corporate Banking Connectivity Solution Today with NetWeaver PI Current solution: Bank buys NW PI licenses in volume and distributes to corporates clients Payment advice is initiated from clients ERPs, processed by Banks and acknowledged Wholesale Banks On-boarding of SAP customers with proven solution End to end connectivity Custom and value-add banking offerings Corporates Improved operational efficiency Ensure better corporate compliance Drive efficient Working Capital Management 2011 SAP AG. All rights reserved. 9

Next Generation Corporate-to-Bank Connectivity Solution Simplified Connectivity Banks provision integration from the cloud, non-intrusive to IT, days vs. weeks to on-board Monitored and managed centrally Banks connect via SWIFT, through the SAP solution Management and visibility application Banks access to register and on-board clients, monitor and manage exceptions Bank-branded access to clients for shared visibility and approvals Register a Client Create a client, profile and users Configure business services Configure SLAs, alerts, reports,.. On-board the Client Client ERP interface details Configure documents, mappings Generate pre-configured agent, download and install Run and Manage Services Reviews and approvals Monitor Resolve exceptions Via SWIFT Net Payment Processing Bank SAP ERP PI Host to Host Corporate to Bank Connectivity Financial Services On-demand App Agent Agent SAP ERP SAP ERP Corporates 2011 SAP AG. All rights reserved. 10

SAP On Demand Innovations in Banking Services including Payments and Cash Management On-demand banking services capability expanded to include additional modules: Payments staging and management Currency hedging for international corporate procurements Liquidity management sweeps of excess cash, convert securities to cash on hand Trade services Supplier Financing, LOC and Export/Import document preparation Factoring of accounts receivables Lightweight modules for staging, forwarding and visibility of transactions Factoring Trade Liquidity Hedging Payment s Bank Connectivity Corporate / Subsidiaries Financial Services Network Benefits for Bank: Rapid on-boarding and customer adoption Lower operating and acquisition costs Value added services Deeper customer relationship Benefits for Corporate: Advanced roadmap for Banking Services Real-time transactions and visibility Close to zero IT costs Easy subsidiary onboarding 2011 SAP AG. All rights reserved. 11

FSN Connectivity Examples: 1. Corp Acquisitions Subsidiary Subsidiary Bank (non-swift Member) FSN Agent 2. Corp HQ Payment Factory FSN Agent Factoring Trade FSN Agent Bank (SWIFT Member) Lightweight modules for staging, forwarding and visibility of transactions FSN Agent Liquidity Hedging Payments Connectivity Financial Services Network FSN Agent FSN Agent Corporate e.g. Brazil 3. Multi- Country Corporates Corporate e.g. Germany FSN Agent 4. SWIFT and H2H Corp 2011 SAP AG. All rights reserved. 12

FSN Technical Solution Architecture SAP Core Banking / Payment Engine Security CBC Service Bank FSN Bank Agent ISO20022 SAP Financial Services Network Hub Configurator Non-SAP Core Banking /Payments SAP PI Bank DMZ Transform/Route FSN Bank Agent RDS Components SAP NW PI Corporate Banking Connectivity predefined service Integration to backend Core Banking systems Connectivity to SAP BSN Hub FSN Corporate Agent RDS Components Bank Communication Management, Corporate connectivity Content and Connector Integration to ERP backend Connectivity to SAP BSN Hub Corporate Connectivity predefined services BCM ERP 6.0 Archiving Modules Monitoring Corporate FSN Corp. Agent Content and Connector ERP 6.0 / 4.7 idocs or ISO20022 Service Non- SAP Apps.... Corporate DMZ Corporate FSN Corp. Agent BCM ERP 6.0 Formats ISO20022 Standard formats SWIFT (MT101, MT940, MT942, ) IDocs Security and Encryption PGP Encryption along entire path: Corporate-BSN Hub-Bank Optional RSA Public Key based Signed Messages Message and Transport level security Pre-authorization and Instruction Level Authorization (ILA) support Other Exclusive Monitoring of Messages (Corporate/Bank Side) Custom Transformations Archiving 2011 SAP AG. All rights reserved. 13

Financial Service Network Solution Overview RDS Packaged Solution for Corporates and Banks to connect to FSN Hub SAP Core Banking / Payment Engine CBC Service Bank FSN Bank Agent ISO20022 Non-SAP Core Banking /Payments SAP PI Bank DMZ Bank RDS Packaged Solution Reuse of NW PI CBC PDS for bank deployment and connectivity to Hub ISO 20022 Message Schemas Transformation maps for ISO 20022 to backend data formats Validation rules Security policies, message semantics Security SAP Financial Services Network Hub Transform/Route Archiving Modules Monitoring Corporate Configurator idocs or ISO20022 Corporate DMZ Corporate Multi-tenant Integration Service Based on PI Next Generation (PING) Light-weight, low TCO integration service Isolation of data, processes, messages across multiple tenants Supports reliable messaging, data encryption BCM ERP 6.0 FSN Corp. Agent Content and Connector ERP 6.0 / 4.7 Service Non- SAP Apps.... FSN Corp. Agent BCM ERP 6.0 Corporate RDS packaged solution Reuse of CDP assets towards creating RDS content for corporates and connectivity to Hub User-exit programs for idoc enrichment Template for backend data extraction ISO Payment format configuration files for DMEE 2011 SAP AG. All rights reserved. 14

FINSAPP is a SAP Systems Integrator and SAP Partner, specialising in SAP HANA, Business Intelligence, Analytics, Predictive Modelling, Reporting, Database & Technology(Real-time data platform) and Mobile technologies. We embrace BI trends and help our clients grow and prosper by unleashing the value of Big Data when utilised with the HANA database in order to anticipate future opportunities and risks. Together we can; Discover the areas in your business in which HANA can deliver additional benefits and value Develop a target architecture for your business processes and the supporting applications, including HANA Derive the best transformation path to integrate HANA into your business Execute a business case for using HANA We pride ourselves on our entrepreneurial vision, innovative thinking and creative ideas and continue to deliver projects to time, to budget, at lowest TCO and highest ROI(REAL VALUE), time and time again. 2011 SAP AG. All rights reserved. 15