In today’s fast-paced financial landscape, corporates and SMEs are under increasing pressure to optimize liquidity and improve working capital management. The rise of real-time payments and access to instantaneous financial data is transforming the way businesses manage cash. But how can they fully leverage these developments—and what more is needed to bring liquidity management into real-time?
Real-Time Payments vs. Real-Time Data: A Crucial Distinction
It’s important to distinguish between real-time payments and real-time data—two interrelated but distinct components of modern liquidity management. Real-time payments refer to the instantaneous transfer and settlement of funds, enabling faster movement of money. Real-time data, on the other hand, involves immediate access to up-to-date financial information, such as balances, transaction status, and cash flow metrics.
Both are essential, but it's the convergence of these capabilities that unlocks transformative value. Without real-time data, even instant payments can fall short of delivering true liquidity insights. And without real-time payments, real-time data lacks the power to drive action.
Leveraging Real-Time Payments for Better Liquidity Management
For corporates and SMEs alike, real-time payments provide immediate visibility into cash inflows and outflows. This instant access to payment data enables businesses to:
- Make faster and more informed decisions about investing surplus cash or drawing on credit lines.
- Reduce the need for large liquidity buffers, since cash positions can be monitored and adjusted in real time.
- Enhance forecasting accuracy by using current transaction data rather than relying on outdated reports.
In Europe, the SEPA Instant Credit Transfer (SCT Inst) scheme has been a major catalyst. It enables euro transactions across participating countries to be settled within seconds—giving businesses the ability to manage liquidity dynamically across borders.
Automating Cashflow Processes: A Critical Enabler
Automation is the bridge between real-time data and actionable insights. By automating key cashflow processes—such as reconciliation, cash positioning, and forecasting—companies can:
- Eliminate manual errors and inefficiencies that delay decision-making.
- Free up finance teams to focus on strategic activities rather than repetitive tasks.
- Integrate diverse data sources, such as bank accounts, ERP systems, and payment platforms, to provide a unified view of liquidity.
For example, many European banks are integrating with PSD2 open banking APIs to allow corporates to pull real-time bank data directly into their treasury systems, accelerating automation and decision-making.
What More Is Needed?
Despite these advancements, real-time liquidity management is not yet the norm. Several barriers remain:
- Legacy infrastructure: Many businesses and banks still operate on batch-based systems that limit real-time capabilities.
- Lack of interoperability: Fragmented systems and inconsistent data formats across platforms hinder end-to-end visibility.
- Cultural and operational resistance: Embracing real-time finance requires not just technology, but also a mindset shift within finance departments.
In the EU, regulatory support such as the proposed Instant Payments Regulation aims to make instant payments mandatory across member states—paving the way for more widespread adoption of real-time liquidity tools.
The Rise of Treasury as a Service (TaaS)
Treasury as a Service is emerging as a compelling model, especially for mid-sized companies without large in-house treasury functions. TaaS solutions offer cloud-based, modular services that can include:
- Real-time cash visibility
- Automated payments and collections
- Liquidity forecasting
- Risk management tools
With the growing maturity of fintechs in Europe—like Tink (Sweden) or Nomentia (Finland)—businesses can access plug-and-play treasury solutions without massive up-front investment. As these platforms integrate more deeply with banks and ERPs, TaaS could become a mainstream model within the next few years.
Conclusion
Europe is already laying strong foundations for real-time treasury operations—through initiatives like SEPA Instant, PSD2, and regulatory momentum toward instant payments. The convergence of real-time payments and real-time data, supported by automation and digital platforms, is reshaping liquidity management. While some hurdles remain, the direction is clear—and businesses that embrace this shift early will be in a strong position to optimize cash and compete globally.
Infosys Finacle is sponsoring EBA Day 2025 – the premier European summit for payments and transaction banking professionals. We will participate in a panel session on ‘Liquidity Management and Real Time Payments. This session will discuss how corporates and SMEs can leverage real-time data to enhance liquidity and working capital management. The session will also explore the role of automation in cash flow processes and the future of Treasury as a Service (TaaS). We hope to see you there.
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