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Cash management is the process of planning and controlling cash flows. However, in banking and financial institutions, cash management is a service offered to corporate clients. This gives businesses access to new financial services, such as payments, collections, and transfers of funds. Not only does it help businesses in reigniting their cash operations, but it also supports businesses with liquidity management – crucial for survival, especially in times of an economic downturn.
However, traditional cash management services, often offered by banks, allow business clients to sign up for the service to manage their cash operations. For SMEs as well as large businesses, this often means physical banking only scaled up. Even though businesses pay hefty charges to manage cash operations, teams and delivery agents are made to personally visit the bank branches and physically deposit cash. Small denominations are often unaccepted in banks, which poses a great challenge for small-scale retailers.
Our article Cash Management System: A Complete Guide explains the process in great detail.
New cash management solutions, such as that offered by Loop, allow businesses to manage their cash end-end with flat-fee and insurance coverage. The holistic approach toward cash management solutions eliminates the need for human touch points, thereby minimising the risk of fraud and errors. Moreover, these services are independent of the volume of cash, which means denominations of every capacity are accepted and deposited in banks in real-time.
The tech-first approach toward cash management covers the following aspects of cash handling and operations
Collections – Allows businesses to outsource cash operations. Collections include rider-based pickups as well as on-premises collections dependent on hardware. This cash is digitised at the point of aggregation and updated within accounts and analytics software in real-time, always keeping relevant teams updated. Automated collections simplify management. This means corporate clients are fast-tracked and banking services remain available 24/7, whether in cash collections, deposits or availability and access to hard-earned finances.
Disbursements – This allows businesses to transfer payments from one account to another business. This includes automated cheque clearing, IBFTs and corporate payouts. Advanced solutions allow businesses to clear corporate cheques and issue transfers in real-time through a single cash management platform.
A cash-native financial solution is essential for businesses that are cash-dependent. Advanced business-focused solutions have the capability of offering services based on financial needs. This goes for:
• Businesses operating in high volumes of cash, that would require on-site cash deposit hardware and cash in transit services. This includes distributors, b2b eCommerce platforms, textiles, explained in detail here.
• Businesses with low volumes of recurring payments that require automated collections, such as educational institutions, gyms or hospitals.
• On-demand cash deposits – Businesses need not stress about completing collections or deposit within banking hours. Cash management solutions allow small- and large-scale businesses to complete deposits at any time of the day.
• Productivity – Delivery agents can optimise routes based solely on drop-offs, increasing the number of customers served within a day. Outsourcing cash collections eliminates the responsibility of collection and deposit – easing the already tight schedule of delivery agents.
• Instant Access to Revenue – Real-time and on-site digitization of cash means an ease of access and availability of finances, reducing the need of daily working capital.
With Loop, your business receives tailor-made cash-first financial solutions. The digital and financial infrastructure allows you to streamline disbursements, automate and digitise cash in real time for any scale. Sign-up for hassle-free collections and disbursements.