The next challenges for the future of treasury in 2023: interview with Sabbir Rahman

1. Financing and liquidity

Credit conditions have tightened in 2023, due to the aftereffects of the Russia-Ukraine War. This has led to a rise in energy prices, which in turn has led to an increase in energy prices. inflation High inflation, rising interest rates and a crisis of confidence in the SVB and Crédit Suisse banks. Against this backdrop, banks are reducing their exposure to certain sectors that they consider to be high-risk, so companies in these sectors may find their panel of banks less inclined to refinance their credit facilities.

In addition, the risk for these companies is that their foreign exchange and interest rate trading lines may be eliminated or reduced in size and duration, even though they are essential to the execution of transactions for financial risk management purposes.

2. Heightened FX volatility

As a result of the crisis of confidence at the SVB and Credit Suisse banks, and the interest rate hike cycles of the BoE, of ECB and Federal Reserve.

Budget rates may have been set at the beginning of the financial year. If rates change significantly between now and the end of the year, treasury departments that were under-hedged could find it difficult to meet budget rates. Or they might not be able to benefit from favourable market trends if they had locked in the majority of their exposure using futures contracts.

3. Cybersecurity risks

In 2023, cybersecurity will continue to be a major challenge for treasury departments. As more treasury operations move online, the risk of cyberattacks increases. Hackers are becoming more sophisticated in their attacks and are specifically targeting treasury departments to steal sensitive financial data, such as bank account numbers, payment instructions, and customer data.

To protect against cyber attacks and minimise the risk of financial loss or reputational damage, treasury departments will need to invest in robust cyber security measures. These include two-factor authentication, encryption and intrusion detection systems. In addition, treasury functions will need to ensure that their teams are adequately trained in cybersecurity best practices. In particular, to reduce the likelihood of human error leading to a breach of security.

To prepare for the next big challenges of treasury, finance departments need to rely on efficient tools and experts to support them. To know more about how Cashlab can help you, don’t hesitate to contact our team.