Treasury Management
Treasury management is the function responsible for managing a company's liquidity, funding, financial risk (including FX and interest rate risk), and banking relationships.
Corporate treasury sits at the intersection of finance, operations, and risk. The treasury function manages the company's cash position — ensuring there is enough liquidity to meet obligations while optimizing idle cash for yield. It oversees bank account structures, cash pooling, short-term investments, debt facilities, and forecasting.
For companies with international operations, treasury management includes managing foreign exchange (FX) risk: the risk that currency movements between invoice date and payment date erode margins. Treasury hedges this risk through forward contracts, options, or natural hedges (matching revenues and costs in the same currency). Treasury also manages intercompany settlements, netting programs (consolidating multi-currency payables and receivables to minimize transfers), and banking relationship optimization.
Modern treasury management systems (TMS) like Kyriba, GTreasury, or FIS Quantum automate cash visibility, payment processing, and FX execution. Integration with ERP systems (SAP, NetSuite, Oracle) ensures treasury has real-time data on payables, receivables, and cash positions across all entities. Bitwage can integrate into treasury workflows by acting as the international payments execution layer.
Treasury Management FAQ
Common questions about treasury management in the context of international payments.
A corporate treasurer manages cash flow forecasting, bank relationships, short-term investments, FX risk, debt issuance, and intercompany payments. In smaller companies, treasury functions may be handled by the CFO or finance director.
A TMS is software that centralizes cash visibility, automates payment processing, manages FX exposures, and handles bank connectivity across multiple entities and currencies. Leading TMS platforms include Kyriba, GTreasury, and ION Treasury. These integrate with ERP systems and payment networks to give treasury real-time control over global cash.
More Business Payments Terms
Expand your knowledge of international payment terminology.
AP Automation
AP automation uses software to streamline the accounts payable process — from invoice capture and approval routing to payment execution and reconciliation.
Accounts Payable (AP)
Accounts payable (AP) is the accounting function managing a company's outstanding payment obligations to vendors, contractors, and suppliers.
Accounts Receivable
Accounts receivable (AR) is the money owed to a business by its customers or clients for goods or services delivered but not yet paid for.
Batch Payment
Batch payment processing is executing multiple payment instructions simultaneously in a single run — reducing operational overhead for businesses paying many recipients.
Batch Payroll
Batch payroll processes multiple contractor or vendor payments in a single run, typically via CSV upload, with one FX rate lock across the entire batch.
Contractor Invoice
A contractor invoice is a payment request from an independent contractor to the hiring company, documenting work performed, hours, rates, and amount due.
Contractor Onboarding
Contractor onboarding is the process of collecting tax forms, banking details, and compliance documentation from new independent contractors before the first payment.
Contractor Payments
Contractor payments are outgoing payments to independent contractors (1099, foreign individual, or business entity) for work performed under a service agreement — not an employment relationship.
Correspondent Banking
Correspondent banking is the arrangement by which one bank (the correspondent) provides services on behalf of another bank (the respondent) to facilitate cross-border transactions, especially in currencies where the respondent has no direct presence.
Cross-Border Payment Fees
Cross-border payment fees include wire fees, FX markup, correspondent bank charges, and receiving fees that add up when sending money internationally.
Currency Risk (FX Risk)
Currency risk is the potential for financial loss due to exchange rate fluctuations between the time a payment is initiated and when it settles.
Days Payable Outstanding (DPO)
Days Payable Outstanding (DPO) measures how long a company takes to pay its suppliers and vendors after receiving goods or services — a key working capital metric.
Dual Approval Workflow
Dual approval requires two authorized signers to independently review and approve a payment before it executes — a key fraud prevention and internal control mechanism.
Early Payment Discount
An early payment discount (e.g., 2/10 Net 30) offers a percentage reduction on the invoice if paid before the standard due date.
Employer of Record (EOR)
An Employer of Record is a third-party organization that legally employs workers on behalf of another company, handling payroll, taxes, and compliance.
Escrow
Escrow is an arrangement where a neutral third party holds funds until predefined conditions are met, protecting both buyer and seller in a transaction.
FBO Custody
FBO (For Benefit Of) custody is a legal structure where funds are held by a custodian in accounts designated specifically for each client, providing segregation and protection.
FX Conversion
FX (foreign exchange) conversion is the process of exchanging one currency for another at a given rate, typically with a spread added by the provider.
FX Hedging
FX hedging is the practice of using financial instruments — forward contracts, options, or swaps — to protect against adverse currency exchange rate movements that could impact business costs or revenues.
FX Rate Lock
An FX rate lock guarantees the exchange rate applied to a payment at the time of approval — not when the payment settles — eliminating exchange rate risk between instruction and delivery.
FX Spread
The FX spread is the difference between the buy (ask) and sell (bid) exchange rates offered by a currency exchanger, representing their margin on every currency conversion.
Global Payroll
Global payroll is the process of paying employees and contractors across multiple countries while complying with each jurisdiction's tax, labor, and reporting requirements.
Invoice Factoring
Invoice factoring is a financing arrangement where a business sells its unpaid invoices to a third party (factor) at a discount in exchange for immediate cash.
Invoice Financing
Invoice financing (also called invoice factoring or receivables financing) allows businesses to borrow against outstanding invoices or sell them to a third party to access cash immediately rather than waiting for customer payment.
MassPay
MassPay is Bitwage's batch contractor payment product that processes up to 10,000 payments in a single CSV upload with automatic rail routing and compliance screening.
Merchant of Record (MoR)
A Merchant of Record (MoR) is the legal entity responsible for processing a payment transaction, handling tax collection, fraud liability, and chargebacks on behalf of a seller.
Mid-Market Rate
The mid-market rate is the midpoint between the buy and sell prices of two currencies on the global market — the "real" exchange rate before any provider markup.
Multi-Currency Account
A multi-currency account holds and manages balances in multiple currencies, enabling payments without repeated FX conversions.
Net 30 Payment Terms
Net 30 means the full invoice amount is due within 30 days of the invoice date — the most common payment term in B2B transactions.
Net 60 Payment Terms
Net 60 means the full invoice amount is due within 60 days of the invoice date — giving the buyer more time but straining supplier cash flow.
Netting
Netting is the process of consolidating multiple payables and receivables between parties into a single net payment, reducing the number of transactions and cross-border transfer costs.
Nostro Account
A nostro account is a bank account held by a domestic bank in a foreign bank, denominated in the foreign currency, used to facilitate international payments without needing to convert currency through intermediaries.
Payment Gateway
A payment gateway is a technology service that authorizes and processes payment transactions between customers and merchants, typically for card or digital wallet payments.
Payment Reconciliation
Payment reconciliation is the process of matching payment records against bank statements and accounting entries to ensure accuracy and completeness.
Payment Reconciliation
Payment reconciliation is the process of matching payment records in a company's accounting system against bank statements and payment platform data to confirm every transaction is accurate and accounted for.
Payment Terms
Payment terms specify when and how a buyer must pay a seller — common terms include Net 30, Net 60, 2/10 Net 30, and due on receipt.
Remote Team Payments
Remote team payments encompass all methods of paying distributed workers across countries — including contractor payments, payroll, and crypto options.
Supply Chain Finance
Supply chain finance (SCF) is a set of financial solutions that optimize cash flow by enabling suppliers to receive early payment while buyers retain longer payment terms.
Vendor Payments
Vendor payments are outgoing payments from a business to external suppliers, service providers, and subcontractors — often the largest category of outgoing B2B cash flow.
Vostro Account
A vostro account is a bank account held at a domestic bank on behalf of a foreign bank, used to facilitate cross-border payments — the mirror image of a nostro account, described from the domestic bank's perspective.
Working Capital
Working capital is the difference between a company's current assets and current liabilities — a measure of short-term liquidity and operational efficiency.
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