Boring, mundane, routine. These are all words that I’ve heard to describe dependable transaction services.
Given the number of fintechs now encroaching on banks’ transaction businesses this is hardly true. Fintechs have been paving a new way for transaction services and there is a buzz around the business.
The competition between banks and fintechs is intensifying, and I have argued in the past that banks could become irrelevant in transaction services. But there is one bank that could buck this trend: Goldman Sachs. Its foray into cash management could change the game.
Euromoney’s Report Cards, published in January, explored Goldman’s plans to roll out cash management services in late 2019 or 2020. Officially, little has been said about the bank’s move into cash.
According to Reuters, the bank will leverage its existing foreign exchange business to start offering corporate clients a greater return on deposits if they sign up for the bank’s cash management services. Goldman Sachs will become its own first client by moving the bank’s own deposits from others onto its cash management platform.
Sensible move
It’s a sensible move.