CHERRY HILL, N.J., Jan. 16, 2020 /PRNewswire/ -- Half of
corporate treasury and finance professionals do not believe an
economic recession is a threat in 2020, according to a recent
survey conducted by TD Bank, America's Most Convenient
Bank®, at the 2019 Association of Financial
Professionals Annual Conference held in October in Boston, Massachusetts.
Instead, payments fraud and cyber security risk are high on
their threat list, with 40% of respondents reporting this category
as a top operational challenge for their organization this
year.
Specifically, about one-in-three (34%) respondents said they are
unconcerned by a potential economic recession, while 16% do not
think that a recession is even imminent. Of the 50% of respondents
who did indicate some qualms about a recession, they are
implementing the following to help safeguard their
organization:
- Increasing capital reserves (25%)
- Holding off on large capital spending projects (18%)
- Accelerating debt payoff (11%)
- Refinancing debt to save cash (8%)
"Finance professionals clearly won't be fretting much over the
prospect of economic volatility in 2020, but cybersecurity is
understandably a continued worry and the headlines show they are
right to be concerned," said Rick
Burke, Head of Corporate Products and Services at TD Bank.
"The half of companies that report that they are preparing for
turbulence in the economy report they have strategies to maximize
finances to weather potential challenges."
Promising Approach to Faster Payment Solutions
In
addition to surveying concerns for 2020, the TD report took a look
at opportunities to grow in the coming year.
The largest opportunity for innovation in corporate treasury is
faster or real-time payment use, according to 46% of respondents.
With the increasing options for faster and real-time payments, the
space continues to evolve. In fact, 30% of survey respondents
already use faster payments, including RTPs for corporate treasury,
and 18% expect to adopt one of these payment options before the end
of 2020.
Of those who responded that they don't currently use or have a
timeline to use faster and real-time solutions, 16% believe they
need to implement them soon, while 14% revealed that they would
love to use faster payments, but are waiting to move forward until
they can reach all endpoints through a single solution.
As in previous years, however, the interest in using technology
solutions does not match corporates' ability to currently adopt
them. About a third (32%) of respondents named the ability to adapt
to faster electronic payments as a top operating challenge in the
2019 survey, while 37% named this same obstacle in a similar
question in 2018.
"Adoption of the newest payment standards will pay dividends for
organizations over the long term," said Burke. "The cost to
companies of not doing so will increase exponentially in coming
years and inaction also presents operating risks. The best time to
upgrade was yesterday, but today's your next best bet."
Blockchain Spending Falls Flat
Although technology
continues to impact treasury operations, only 6% of professionals
named blockchain and distributed ledger technology as the most
opportunistic area of investment for treasury operations in the
coming year. This weak predicted spending is in stark contrast to
the 92% of respondents who, when led to consider the favorable
aspects of blockchain in corporate treasury, named at least one
positive benefit the technology would bring to the payments
industry. Those benefits were speeding up the payments process
(28%), improving cross-border payment efficiency (22%) and reducing
payments fraud (22%).
The top areas of treasury operations where organizations do plan
to invest and/or see the most opportunity include:
- Data, analytics and reporting (23%)
- Cybersecurity and fraud protection (22%)
- Artificial intelligence, machine learning and robotic process
automation (22%)
- Automating payment and payment posting processes in A/P and/or
A/R (16%)
Survey Methodology
TD Bank polled finance
professionals at the 2019 AFP Conference held Oct. 21-23, 2019, in Boston, Massachusetts. A total of 329 responses were
collected from industry professionals, including business end-users
and financial and technology services organizations.
About TD Bank, America's Most Convenient
Bank®
TD Bank, America's Most Convenient Bank, is
one of the 10 largest banks in the U.S., providing more than 9
million customers with a full range of retail, small business and
commercial banking products and services at more than 1,200
convenient locations throughout the Northeast, Mid-Atlantic, Metro
D.C., the Carolinas and Florida.
In addition, TD Bank and its subsidiaries offer customized private
banking and wealth management services through TD
Wealth®, and vehicle financing and dealer commercial
services through TD Auto Finance. TD Bank is headquartered in
Cherry Hill, N.J. To learn more,
visit www.td.com/us. Find TD Bank on Facebook
at www.facebook.com/TDBank and on Twitter at
www.twitter.com/TDBank_US.
TD Bank, America's Most Convenient Bank, is a member of TD Bank
Group and a subsidiary of The Toronto-Dominion Bank of Toronto, Canada, a top 10 financial services
company in North America. The
Toronto-Dominion Bank trades on the New
York and Toronto stock
exchanges under the ticker symbol "TD". To learn more, visit
www.td.com/us.
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SOURCE TD Bank