Price is king for corporate treasurers

Price was the most pressing consideration for corporate treasurers when selecting transaction products in 2016, according to new research from leading European bank BNP Paribas and the Boston Consulting Group (BCG).

A total of 70 per cent of participants in the 2016 Corporate Treasury Insights Report, a global survey of treasurers at multinational corporations, said that pricing was their primary consideration in selecting transaction banking partners, followed closely by service quality at 60 per cent.

Product enhancements and value-added services were the least important factors, with just 2 per cent of respondents highlighting it as a selection criterion. Product depth and market leadership also fell low on the list at just 14 per cent and 12 per cent respectively.

The research found a growing burden on treasurers, with expanding responsibilities and increased functional complexity. As a result, there is general expectation from finance professionals for banks to smooth the way by prioritising their customer experience and providing simple, integrated and cost-effective solutions.

The findings show a continuation of trends observed in the 2015 survey. Even in a climate of rapidly expanding digital platforms and functionality, often from non-traditional service providers, continued market uncertainty and operational complexity mean that treasurers are focused on predictable, reliable solutions rather than innovative services or experimental product enhancements.

 “We are old-fashioned and traditional in the products we use,” commented one interviewee. “We focus on keeping things simple.”

The research canvassed opinion from 750 corporate treasurers and CFOs from organisations around the world.