Context
Nostro accounts are the bank's accounts at foreign correspondent banks and sit at the centre of intraday liquidity management. When their balances and intraday movements are tracked manually, two problems follow: the balance is not known in real time, and the order of payments falls to individual judgement. The result was that some customer payments waited when they should not have, while others were processed ahead of schedule needlessly.
Approach
- The infrastructure used to track nostro cash flows was rebuilt and existing functions improved.
- Manually handled tracking and reconciliation were systematised.
- A sequencing logic was defined so treasury payments transferred according to priority.
- Operational risk sources — manual entry, late reconciliation, incomplete balance visibility — were addressed at process level.
Outcome
- Systematising manual work reduced operational cost and workload.
- Sources of operational risk were reduced.
- Sequencing payments by priority prevented delays in customer payments.
- Intraday liquidity visibility stopped depending on individual tracking.
This case study describes the project through its scope and approach. Client name, commercial figures and performance metrics are withheld under confidentiality obligations.
What This Project Left Behind
In liquidity management the real issue is not whether money exists but knowing where it is and when. An institution with sufficient intraday balance will still delay a payment if it cannot see that balance. This is precisely what a 13-week cash flow does for a company: visibility comes before liquidity itself.
- Cash Management — Corporate cash management strategies that make your cash flow predictable and reduce liquidity risk.