When it comes to business success, cash management must be a priority. Maintaining effective cash management practices is a necessary component for long-and-short term business growth. To improve cash management practices, business owners have a useful resource in banks, which offer a variety of easy-to-use treasury management tools. In addition to simplifying and regulating cash flow, these tools help business owners improve financial forecasting, enhance operational efficiency, reduce risks of fraud, leverage automation, and integrate data.

Here are four treasury management tools that could enhance your business’ cash management:

Electronic funds transfer (EFT): Most EFTs take the form of payroll direct deposits, federal and state tax payments, and electronic debits and credits and debits. Transferring funds electronically via the Automated Clearing House (ACH) is more efficient and less expensive than mailing paper checks. For example, it costs an average of $1.22 to process a paper check but just pennies to process an ACH transaction.

Lockbox: Instead of mailing checks to your business, customers mail them to a special post office box where the bank deposits them immediately. This improves receivables collections by reducing mail float, thus accelerating cash availability. It also eliminates the need for an employee to make deposits at the bank.

Remote deposit capture (RDC): With RDC, you can deposit checks right from your office using a special scanner and software, which boosts cash flow. Similar to lockbox, this also eliminates employee trips to the bank, which improves productivity.

Positive Pay: This service has become more important as the threat of check fraud has grown. You provide the bank with a list of checks issued, which the bank compares against checks presented for payment. If any checks have been presented that don’t match the list, you’re alerted and decide whether to pay them or not.

ACH Positive Pay is similar; if any electronic payments are initiated that don’t match your vendor list, you are alerted and can approve or reject the funds transfers.

The options vary, but the impact is consistent: leveraging treasury management tools offered by banks is a great way to improve the cash management of a business, no matter the size.

Dembo Jones regularly guides clients in ways to use these tools and others to enhance cash management and planning. Get in touch with us today to learn how we can help.