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Analysis on Demands of Cash Management
● Realize seamless linkage with bank through ERP system as well as real-time enquiry and handling for the funds in bank.
● The group manages the member units with the mode of “separation of expense from income”; according to the management authority of the fund, the member units hand in part or all funds to the headquarters of the group; the group controls purpose, direction and amount of the payment of the member units in an all around way.
● The group hopes that it can adopt E-payment method like B2B and B2C in order to enhance the efficiency of the purchase as well as realize easy payment and fast collection of upstream and downstream suppliers and purchasers.
● The group hopes that bank can offer whole financial support for the group as well as its upstream and downstream related clients to enhance the relationship between links of the supply chain.
● The headquarters of the group has demand on the wealth management for the funds collected and requires moderate income and higher return.
Cash Management Solution
Aiming at the demand of the client, with rich financial products and technological advantage, ICBC offers quality and efficient payment and collection products, active and moderate financial services, timely and adequate financing guarantee as well as comprehensive accurate account information so that the funds and information of the client can flow safely and smoothly together with logistics and the enterprise can realize the overall goal of liquidity, safety and profitability of the fund management.
ICBC customizes comprehensive service plans and offers personalized professional services in five aspects including bank-enterprise interlink, fund payment and collection, fund collection, supply chain and wealth management.
1. Whole thought of the plan
2. Bank-enterprise Interlink
Aiming at the demand of group on centralized management and payment control, ICBC designs a group account framework of "separation of expense from income", and establishes a linkage control relationship between the account of the headquarters of the group and the accounts of the member units. Through the bank-enterprise interlink, ICBC establishes the linkage between the ERP system of the group and ICBC system whereby the financial persons of the headquarters of the group can enjoy account enquiry, fund collection, appropriation and other specified services through ERP system so as to realize the centralized control of the group on the funds and information of the member units.
3. Collection and Payment Solution
As to the daily settlement business of the client, ICBC offers traditional financial products such as check, bill of exchange and commission collection; as to the outlet with large cash amount from collection, ICBC offers onsite collection service.
Aiming at the feature that the group has various business and loose structure, ICBC designs a payment service combination plan taking E-banking approval on payment as the main body, and sets the basics authority of the Internet Banking customer certificates of the responsible persons of the member units as zero so that the payment shall be completed after approval and authorization by the headquarters of the group; the group may complete the payment for some links like purchase and supply through B2B and B2C functions of Internet Banking.
4. Fund Collection Solution
Aiming at the demand of the group on the timely fund collection, ICBC designs a solution based on the bank-enterprise interlink system for the group. The financial personals of the headquarters set the time and method of the fund collection according to the demand and collect the funds of the member units to the headquarters of the group daily. As to the fund collection for the sales companies to which the group has no financial control right, ICBC resolves the problem through setting commission loan mode.
5. Supply Chain Solution
ICBC designs two products for the group. As to the upstream suppliers, group adopts commission loan method. The group can "loan" part advance for goods to the upstream suppliers in the form of commission loan. When the suppliers deliver the goods, if the product quality and delivery term meet the requirement of the group, the group will deduct the commission loan to the suppliers as the payments for the purchase. If the product quality and delivery term can't meet the requirement of the group, the group can refuse to pay for the goods, distrain guaranty or take other measures to preserve property.
Aiming at downstream agents, ICBC designs a financing product-united letter. The concrete procedure is that, the group chooses an agent with large scale and sound benefit; first, the ICBC branch in where the agent opens a margin account, after handing in deposit in terms of certain proportion, the bank of the agent issues an irrepealable deferred payment letter of credit for the agent for the payment to the group for the goods; after receiving the text of the domestic letter of the credit offered by ICBC, the group entrusts a logistics and storage supplier to deliver the goods and submits the notes under the letter of credit to ICBC in order to apply for commission collection, or seller financing (negotiation); when the letter of credit is mature, the issuing bank will deduct corresponding funds from the settlement account of the agent for payment.
6. Wealth Management Plan
Through detailed analysis on the production and operation conditions of the group, ICBC customizes a comprehensive wealth management plan: in order to not influence the demand on the payment to the outside, and enjoy interest earnings higher than current deposit, ICBC opens a agreement deposit account for the group; as to the funds that are not paid out immediately, ICBC offers bond trading financial products with flexible term and steady earning to the client and the anticipated income of every product is higher than that of the fixed deposit during the same period.
Plan Implementation Effects
Through carrying out the plan, the group can enhance the control on the internal member units, speed up the reflow of the payment for goods, effectively control payment to outside and maintain steady cash flow. Meanwhile, with the advantage as a core client, the group can enhance the supply chain relationship with upstream and downstream related clients and realize ideal earnings through moderate financial method.
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