Nicole Walker__Head of Product Management Payment Solutions, PostFinance Ltd, Member of the Swiss Payments Council

Capital works better without paper

“Big things often have small beginnings” is a particularly apt saying in the age of digitization. There’s no doubt that digital transformation is one of the most essential drivers of growth in an economy such as Switzerland. Expectations are running high: people are counting on the economy to deliver innovation and disruptive business models that enrich our lives and create a foundation for growth. There’s a lot to look forward to. But at the same time it’s worth remembering that not every business in Switzerland aspires to radically digitizing established offerings from one day to the next. They’ve been around too long and operating too successfully in the marketplace; and besides that, there’s no need. Sometimes it’s possible to achieve big things by digitizing routine business processes. Take working capital management. The name says it all: it’s about systematically planning and putting capital to work.

It is mainly about taking steps to enable liquidity to be managed and deployed as effectively as possible. This is done by adapting business processes, and includes analyzing payment processes. Here lies plenty of optimization potential that can be easily harnessed in conjunction with ISO 20022.

By harmonizing payment traffic, the Swiss financial center is building the foundation for simple but very effective working capital management. All the banks are working on the basis of a single technology standard. The ISO 20022 format enhances data quality, accelerates the exchange of information, and leads to a greater degree of automation in liquidity management processes − for example with the new QR-bill, where customer and invoice numbers are automatically sent to accounts receivable, simplifying controlling and dunning as well as delivering valuable information for the whole customer management process. That’s only one of many examples of the business benefits of the new payment formats. Organizations of all sizes receive valuable information that they can use to manage and optimize their liquidity and put their capital to work profitably.

The payments harmonization is the biggest infrastructure project for the Swiss financial industry in the last 30 years, and as such constitutes a major step towards the country’s digital future. At the same time it’s an opportunity for companies to take a digital step in line with their own needs and conceptions.