Digital technology adoption in a bank Treasury and performing a Digital Maturity Assessment

Abstract

The importance of a Treasury department in a commercial bank has increased in recent decades. After the 2008 financial crisis the remit of a bank Treasury has expanded in terms of scope and strategic significance, evolving from a transactional cash manager to a balance sheet custodian. In order to meet this broader strategic mandate Treasurers must consider ways to become more efficient and streamlined. Adoption of digital technologies and related innovation that underpins the Fourth Industrial Revolution can address many of the traditional Treasury challenges and deliver a wide range of benefits. The adoption of digital technology in bank Treasuries tend to be lower than in other business areas within a bank. There are a number of reasons, but it often includes the lack of a well-articulated digital transformation roadmap. There is thus a need for researching a Treasury specific approach that can provide guidance on developing a digital implementation strategy and enable the transition towards a next generation ‘smart’ digital Treasury department. This paper focusses on a key component of digital transformation, namely performing a Digital Maturity Assessment. It is essential to determine the digital maturity level of a Treasury function, in order to ensure the appropriate Treasury activities and digital technologies are identified and prioritized for digitalization.

Keywords:

• digital technologies
• Fourth Industrial Revolution
• innovation
• evolution of treasury
• digital maturity assessment
• smart digital treasury

Disclosure statement

No potential conflict of interest was reported by the authors.