NetSuite banks on HSBC as it pushes into Fintech

Stuart Lauchlan Profile picture for user slauchlan October 19, 2021
Netsuite and banking...with help from HSBC

Evan Goldberg

NetSuite today at Suite World in Las Vegas launches Suite Banking, its mid-market Fintech offering to provide easier access to a range of financial services, backed up by an alliance with global banking behemoth HSBC.

According to the firm’s official pitch, SuiteBanking will offer NetSuite customers the ability to automate a number of key cash flow processes, including:

  • Accounts Payable (AP), to accelerate Accounts Payable processes with automated invoice scanning and General Ledger code assignment, three-way invoice matching as well as automated outbound payments.
  • Accounts Receivable (AR), to boost on-time payments, reduce days sales outstanding and improve the efficiency of billing staff.
  • Bank Reconciliation, to help customers eliminate manual, error-prone and time-consuming tasks and accurately match transactions with their organization’s bank account.
  • Spend Management, to help customers control corporate spend.
  • Expense Management, to help customers control costs, enforce internal policies and procedures, and improve the timeliness and accuracy of employee expense reports. 
  • International Payments, to provide customers with a global digital wallet to make and accept payments from a single account, utilizing HSBC’s presence in more than 60 countries.
  • Access to Working Capital, to help improve cash flow by giving customers a convenient way to convert unpaid invoices into cash.

ERP first

According to Oracle NetSuite EVP Evan Goldberg, this is all aimed at making managing cashflow easier for mid-market customers. It’s also a first for a firm like NetSuite, he adds, with the company staking a claim to being the first major ERP suite with natively-integrated banking solutions:

We don't compare ourselves to  large enterprise ERP. In our space as a cloud ERP solution for the mid-market, this is groundbreaking…You just don't want your people, especially this era where labor is at a premium, spending their time on manual processes of reconciling bank accounts or entering bills or manually receiving payments from customers, depositing checks. Spend time building your business, focusing on what's important.

On the inside front, it's really about knowing where you stand every day or every hour, having that cash position be something that you can really rely on. You have great visibility into it at any time. I think that's really helpful for entrepreneurs that have to make quick moves and worry about that.

Liquidity is at a premium right now. You may need to make a large purchase of supplies, because you have a beeline on stuff that you need and you don't know when you're going to get that opportunity again. You need to know exactly how much you have and also having the opportunity to borrow to get working capital for those kinds of large purchases that you might need  to make in this rapidly changing environment. That cash flow optimization is critical.

HSBC's bigger picture 

For its part, HSBC is pitching this as its own effort to launch a Banking-as-a-Service solution, with NetSuite as the first in what will be more partnerships to come as part of what Barry O’Byrne CEO Global Commercial Banking at HSBC, says is “the first alliance of many”.

The HSBC BaaS offering uses the bank’s Application Programming Interfaces (APIs) to embed its solutions in clients’ own platforms, following the launch of its API Developer Portal in June this year. This gives developers access to a range of HSBC’s API solutions and a safe sandbox environment for testing. O’Byrne comments:

By combining new technologies with our global reach and deep transaction banking solutions expertise, we will be able to partner with our clients to offer business banking propositions to their customers – integrated into their platforms and with the backing of HSBC’s technology and international network. Embedding our solutions into our customers’ platforms is central to our strategy of supporting our clients’ growth across all regions, from Asia to the Americas. 

What shape these future alliances take - and what other tech companies might throw in their lot with this initiative - remains to be seen. For now NetSuite’s Goldberg pitches the new tie-up as bringing much needed capabilities to mid-market customers:

At the core of it is AP and AR automation. It's just accelerating productivity through efficiency -  less entering of data, us dealing directly with the bank, less manual matching of transactions. It starts with the AP automation that's capturing your bills. Vendors can just send their invoices, directly to an email account and it gets automatically scanned. It automatically creates a NetSuite transaction using AI, Machine Learning, Optical Character Recognition, etc.

Then on the AR side, customers can pay through a payment link and that comes on their invoice. They could automatically pay with ACH or debit card or credit card or whatever they choose to use,  any online payment options. Obviously, this increases on time payments. Then there's a full portal called My Account, which lets them manage all of their invoices and other information that resides in NetSuite, 24/7 on the web.

The new push also expands the existing NetSuite Expense Management offering, he adds:

We've already provided the ability to do mobile expense captures by taking a picture of your receipt with your phone. Now we're going to be adding a payment card, so that customers will be able to use this sort of virtual card or a physical card for purchasing, just to make it much more automated to deal with employee expenses. The global wallet allows you to make payments all over the world without having to have a bank account and dealing with the issues of currency all over the world in over 60 countries. All that syncs back into NetSuite.

Finally, when you talk about cash flow, first of all you just want to know how much you have. Automated reconciliation is going to automatically match the transactions coming in to the bank to the transactions in NetSuite. so you always know sort of where you stand from a cash perspective. In addition, there's going to be direct access to working capital straight through NetSuite using the information in NetSuite as  backing for this.

My take

A good win for NetSuite to be at the forefront of HSBC’s wider BaaS ambitions, ambitions that will certainly expand to incorporate other tech partners over time. 

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