K C Bhushan

IBM and CashTech, an Indian ISV focused on the banking segment, have signed a joint marketing and sales alliance. The two companies will go to market with complete solutions including hardware, networking, middleware and CashIn, CashTech’s cash management application. Built from scratch using IBM WebSphere and MQ Series, CashIn has been in the making for over a year. Initially the two companies had a technology alliance, which was then enhanced to a global technology, sales and marketing alliance. “Banks are branching out and this was an area that we wanted to focus on. IBM is partnering with ISVs to cater to this demand,” says Frank Luksic, vice president, Software Group and Developer Relations, IBM India.

Transaction volumes managed by CashIn are huge running up to 10 million cheques per year. Key features of the product include cash management for particular verticals and the ability to configure an entire process. Banks offering cash management services make as much as 40 percent of profits in commercial banking from cash management. Currently banks are offering products on the transaction management side. Cash management is considered synonymous with basic collections and payments management and simplistic liquidity management products. With pressure on float based incomes, fee-based offerings are becoming the focus. “Banks are looking at business that is fee-based and not credit-oriented,” says K C Bhushan, founder-director, CashTech Solutions.

Fee-based products such as receivables management outsourcing and the information-reporting end of the cash management spectrum are becoming the area of future growth for banks. With Ernst & Young predicting that 55 percent of banks will be offering cash management services by 2003, up from 25 percent in 2000, CashTech is optimistic about CashIn’s prospects.

Syndicate Bank has implemented the IBM-CashTech solution. The value of CashTech’s deals with banks range between $200,000 and $3 million. The Indian market for cash management products has been valued at Rs 1,500 crore. Worldwide CashTech products have been licensed by 15 institutions and are installed in 40 locations in 18 countries. CashTech’s clients include ABN AMRO, BNP Paribas, Deutsche Bank, HDFC Bank, HSBC, Standard Chartered Bank, SCG Shinsei Bank, State Bank of India and Syndicate Bank. The company’s strategy for the next 12 months is to become a prominent player in the US and Japan markets.