Standardising Billing Data: A Key to Optimizing Corporate Treasury

Digital and standard billing statements for enhanced control and decisions

Treasury organisations play a key role in enabling businesses to achieve better visibility and control over their expenses and costs. One of their key challenges is the control of bank fees and the value they provide, as many banks have very different billing methods and reporting practices across geographies.

To address this pain point, frameworks such as TWIST, ISO 20022 camt.086, and AFP Service Codes have been developed to standardise and digitalise the communication of banking data to wholesale clients. Adopting these standards supports not only a global, consolidated control and view of bank fees, but also of bank transactions and account balances. It further empowers treasuries to address varying maturity levels within their operations.

Leveraging TWIST, camt.086, and AFP Codes for harmonised billing data exchange

Digital bank billing statements can vary in form and content, making it essential to adopt standards to create harmonised, structured data from diverse sources.

Transaction Workflow Innovation Standards Team (TWIST): TWIST has defined global standards that simplify data exchange between banks and treasuries, offering a uniform framework for transaction data reporting.

ISO 20022 camt.086: ISO 20022 standardise file formats for electronic communications between financial institutions and corporates, including camt.086 which incorporates some TWIST principles. The camt.086 file format reports on bank fees in a structured manner and details bank charges down to the transaction level. This not only standardises data for electronic import, but also gives treasurers granular insights into specific services and transaction costs, enhancing both account-level and transaction-level controls.

AFP Service Codes: Developed by the Association for Financial Professionals (AFP), AFP Service Codes standardises the categorisation of bank services and fees. By implementing AFP codes, treasurers can adopt a consistent approach to pricing analysis and benchmark service costs across different banks. This lets them make cost-saving decisions, such as which payment method they choose, and achieve straight-through processing across a global network of banking relationships.

Supporting Global Consistency with Consolidated Statements

Many specialised software solutions and treasury management systems (TMS) leverage camt.086 (or TWIST) and AFP codes for bank account management and bank fee analysis functionalities. This standardised format enables treasurers to aggregate statements into consolidated global views that support effective account analysis and easier reconciliation against pre-agreed pricing terms. By centralising billing data and transaction fees into a single treasury platform, treasurers gain immediate certainty and control over the correctness of bank charges and insights into service usage and account activity across all locations.

Tailoring Solutions to Treasury Maturity Levels

Global consistency is essential for treasurers managing accounts across regions. Treasuries vary widely in operational maturity, with each stage presenting unique requirements for ingesting, analysing, and reconciling bank fee statements. A tailored approach enables treasurers to implement solutions aligned with their organisational capabilities.

Strong treasuries: AFP code-based categorisation offers an effective starting point for the implementation of basic data ingestion tools such as spreadsheets, with a focus on essential reporting and visibility with minimal investment.

Maturing treasuries: Straight-through processing solutions enabled by automatic import of camt.086 (or TWIST) electronic bank fee statements allow automatic reconciliation of bank fees against pre-set pricing terms, and built-in reports for enhanced visibility and consistent cost comparisons across banks.

Advanced treasuries: With seamless global data ingestion and reconciliation, advanced analytics are available through built-in dynamic dashboards or Business intelligence (BI) tools. This provides on-demand insights for periodic reviews of banking relationships, prompt response to management requests, or informed preparation for M&A activities, and ensures data integrity and consistency as pre-requisites for activation of emerging AI assistants.

Conclusion

Corporate treasurers can benefit significantly from global consistency in fee categorisation and pricing transparency.

Regardless of a treasury’s maturity level, the standardisation of billing methods and reporting practices enable treasurers to better control the enforcement of bank billing as per pricing agreements. The adoption of these digital solutions empowers treasurers to contribute to cost control initiatives, promote operational efficiency, and formulate informed recommendations to assist strategic decisions in their organisation.

In HSBC, we continually invest in billing solutions to keep them up to date, increase global coverage, and provide consolidated global solutions, while actively working with our customers, partners and industry experts to evolve our solutions to suit the needs of all.