For many years, corporate treasurers relied on a mix of manual processes and fragmented systems to manage cash, liquidity and financial risk. Over the last two decades, the landscape of Treasury Management Systems (TMS) has evolved significantly, moving from simple spreadsheet-based workflows to sophisticated real-time API integrations.
In this article, we explore the history of TMS and how technology has transformed treasury operations.
In the past, treasury professionals had to download bank statements manually from different banking portals and then upload them into their ERP or treasury software. The “system” consisted of manual bank uploads, often using CSV files, with limited digital processes. This was time-consuming, prone to errors and offered little real-time visibility.
Some key challenges included:
To address these inefficiencies, companies began using basic treasury management software that could ingest bank statement files in formats such as MT940 (SWIFT), BAI2 or CSV to automate reconciliation.
As companies expanded and treasury functions became more sophisticated, the need for more automated data exchange led to the adoption of host-to-host (H2H) connections and SWIFT connectivity.
Initially, large corporations established direct file-based connections with their banks to receive bank statements and send bulk payment files securely in a system known as host-to-host. This removed the need for manual downloads but remained batch-based and required significant IT involvement.
Meanwhile, the Society for Worldwide Interbank Financial Telecommunication (SWIFT) introduced a standardised messaging framework, enabling treasurers to receive consolidated bank statements from multiple banks through a single channel.
While H2H and SWIFT were major advancements, they still had limitations in terms of real-time data access and flexibility.
The latest wave of treasury innovation is being driven by APIs (application programming interfaces), enabling real-time, on-demand connectivity between banks, ERPs and Treasury Management Systems like Embat.
With APIs, finance teams can retrieve bank balances and transactions in real time.
With APIs, finance teams can:
Regulatory changes, such as the revised Payment Services Directive (PSD2) in Europe, have played a crucial role in accelerating the adoption of open banking APIs. By mandating banks to provide secure API access to account data, PSD2 has improved transparency, enabled faster transactions and ultimately delivered more efficient treasury operations.
As APIs become the new standard, the future of treasury lies in fully integrated ecosystems, where Treasury Management Systems, ERPs and banking partners communicate seamlessly.
Emerging trends include AI, blockchain and embedded finance.
Emerging trends include:
From manual bank uploads to API-driven real-time connectivity, the evolution of Treasury Management Systems reflects the growing demand for efficiency, accuracy and strategic insight in corporate treasury.
As technology continues to advance, treasurers will have even greater control over liquidity, risk management and financial decision-making.
