Recent trends in Indian transaction banking include evolving treasury management, with treasury becoming a strategic partner. Transaction banking is a core focus for global banks in India, with Bank of America emphasising globally consistent, locally relevant solutions, Sanchay Agrawal, India head, Global Transaction Services, Bank of America said in an exclusive interaction with ET Online’s Gourab Das. Indian banks are competitive, and global banks are preferred for international transactions. Real-time treasury solutions aren’t universally demanded; “On-Time Treasury” is favored, Agrawal said, adding transaction banking is transforming Indian businesses through digitisation, AI integration, and sustainability-linked financing. Edited excerpts:
What recent trends are you seeing in transaction banking in India, and what role does a bank play?
The transaction banking landscape is evolving rapidly due to changes in treasury management. Treasury is no longer just a service or cost center; it’s now a strategic partner driving efficiency and impact. Key trends include technology advancements, speed, and transparency.
Treasury’s role includes providing direction to business units, optimising liquidity, managing costs, maximising capital returns, ensuring AP and AR functions meet objectives, and enhancing process efficiencies. Bank of America serves Indian subsidiaries of large corporations, global financial institutions, and large Indian companies. Trends we observe are process efficiencies, technology investments, and increased focus on risk management.
Risk management is rightly the correct focus area with so much volatility in FX markets, geo-political factors, interest rates, cross border trade & supply chain plus the dynamic regulatory environment that we have in India.
Our role as a bank is twofold: trusted advisor and technology enabler. We leverage our global presence to offer tailored solutions and invest heavily in technology to solve clients’ problems cost-effectively.
Is transaction banking a priority for global banks in India, and what’s Bank of America’s strategy?
Transaction banking is core for Bank of America. India’s growing corporate sector and trade importance make it a focus market. Our Global Transaction Services (GTS) business has seen consistent high growth. We aim to provide globally consistent yet locally relevant solutions, with a focus on trust, client service, and technology.
Our strategy is to offer state-of-the-art solutions, ensuring security and compliance, while delivering top-notch advisory services. We’re dedicated to simplifying business operations.
India is a very large and complex market from a transaction banking perspective, so regulatory advisory and industry insights from our experienced team go a long way in our go-to-market strategy. Also, because it is a business that relies on trust, day-to-day servicing and client delivery is very critical.
How competitive are Indian banks in transaction banking, and how do global banks like Bank of America fit in?
Indian banks are strong locally and strive to upgrade technology to compete globally. We collaborate with local banks to serve clients. Large Indian corporates and banks choose global banks like us for international transactions, while they prefer Indian banks for local cash management.
As India emerges as leading market for more and more global companies, we aim to deliver a superior transaction banking platform to meet the evolving treasury needs of these customers. We also understand the competition is fierce for this segment, however we are confident that we can get a fair share of growth in this business.
Are corporate treasurers in India demanding real-time treasury solutions?
Real-time treasury solutions are not universally demanded. Instead, “On-Time Treasury” that optimally manages processes is preferred. The goal is to meet needs when needed with appropriate execution, rather than real-time transactions. Continuous visibility and process automation are the real trends in treasury.
How is transaction banking transforming Indian businesses, and are there game-changing products/services?
The shift from paper-intensive to digital banking is significant, driven by government digitization efforts. This transition enhances efficiency, reduces costs, and improves transparency. Integrating artificial intelligence into processes, like invoice reconciliation, is another focus area. Technology like Intelligent Receivables streamlines critical processes, saving time and minimizing errors. Additionally, sustainability-linked financing initiatives are gaining traction, aligning with clients’ sustainability goals.
