Redefining Treasury: how treasury is powering the next generation of institutional clients

Institutional clients are facing unprecedented change, shaped by three converging forces: accelerating flows into private markets, rising expectations for seamless digital experiences and rapid technological advancement.

Against the backdrop of political tensions and uncertainty and as global operating models evolve, remaining competitive requires more than incremental improvement. Speed, scale, transparency and control are the fundaments of the next-generation treasury function – one that is strategic by design.

Drivers behind treasury transformation

Private markets are booming. Global alternatives are expected to grow from $16.8 trillion in assets under management in 2023 to $29.2 trillion by 2029¹. However, this trajectory may be tempered by the evolving macroeconomic climate. Once dominated by institutions, private flows are being democratised through retail-friendly platforms, reshaping investor profiles and treasury models.

Converging business models are accelerating complexity. Insurers and alternative investment firms are entering each other’s markets, creating hybrid financial institutions with new and distinct treasury needs.

At the same time, a generational wealth shift is redefining what clients expect from financial services. Over the next two decades, an estimated $84.4 trillion will move into the hands of Millennials and Gen Z²: digital-first generations expecting instant, transparent and frictionless service.

In these conditions, treasuries are adapting fast. QBE Insurance Singapore improved efficiency and customer experience: “through HSBC’s understanding of our ambitions and array of digital solutions, we are thrilled to be able to realise a fully digital collections and payments process, leveraging the real time payment infrastructure. We see this as a key milestone in helping forge a path for the insurance industry in an increasingly paperless society,” explains Ronak Shah, company’s Chief Executive Officer.

Real-time expectations are rising: a recent survey shows that 38% of non-bank financial institutions expect domestic instant payment volumes to rise over the next 12 to 18 months, while 27% anticipate growth in cross-border real-time activity³.

To meet such demands, SAXO Capital Markets partnered with HSBC. Thomas Qvistgaard Hansen, Asia Pacific Chief Operating Officer, highlights: “we are very happy to be able to launch on-demand instant collections for our clients as it brings a much smoother client experience as they trade and invest in the market, without the need to leave the SAXO platform.”

Technology is one of the key enablers. From APIs to embedded payments, central bank digital currencies (CBDCs), tokenisation, distributed ledger technology and artificial intelligence (AI), these new tools are unlocking faster onboarding, greater efficiency and smarter execution. Today, 91% of investment managers are either using or planning to use AI in their research and decision-making⁴. From robo-advisors to AI-powered tools, combined with the rise of digital currencies and tokenised assets, a new wave of opportunities to streamline investment execution is emerging.

Treasury: the strategic engine of institutional clients

“Institutional clients today aren’t just looking for efficiency, they’re looking for strategic enablement. Treasury must evolve from a transactional function into a hub of real-time intelligence, driving faster decision-making, unlocking liquidity and supporting growth at scale,” says Francois Ionesco, Global Head of Institutional Sales, Global Payments Solutions at HSBC.

Resilience is now a top priority as tighter regulations, escalating cyber threats and increasing importance of counterparty risk demand a secure, compliant and agile infrastructure.

“In today's unpredictable and volatile market, consistently minimising risks within your cash management processes is crucial. In my role at Invesco, I emphasise the importance of thoroughly reviewing all inherent risks. Being an expert on your processes and understanding the flow of each £/$ in and out is key to ensuring robust risk management and financial stability. Additionally, leveraging data and seeking out innovative solutions are essential to staying ahead and effectively managing risks,” explains Mandeep Rathod, Global Assistant Treasurer at Invesco.

CFOs and treasurers are seeking consultative banking partners who combine strategic insight with operational excellence. Digital-first infrastructure, robust data governance and resilient IT architecture are becoming baseline requirements. Real-time visibility across global exposures is critical to effectively manage counterparty risk.

The rise of private capital flows, hybrid business models and digital-first clients is accelerating the need to scale and innovate. As treasury moves from reactive to predictive, it must enable high-volume onboarding, seamless transaction flows and frictionless access to global liquidity. Efficient collection and reconciliation across large client bases becomes a competitive edge.

Instant subscriptions and redemptions are becoming key differentiators, enabling real-time insights to improve forecasting and efficiency. Real-time liquidity ensures capital is deployed precisely, while idle cash is optimised to capture higher yields.

Achieving treasury excellence

Institutional clients are rethinking how they serve their end-clients, turning to next-generation payment capabilities to gain a competitive edge.

Banks with deep sector expertise and strong payments capabilities are uniquely positioned to enable this transformation.

Success depends on trusted partners who offer relevance and reach. Those who can simplify global delivery, offer proactive solutions and bring contextual intelligence will support institutional clients unlock new sources of competitive advantage.

The key to treasury excellence? Faster decisions. Smarter tools. Simpler control of complexity. The winners will be those who embrace real-time intelligence, adopt next-gen technologies and collaborate with providers capable of delivering seamlessly at scale: globally, intelligently and with precision.