Digital Banking - Embracing technologies that embrace your operations

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There's a great distance between here and there, between now and next. We could and we did. It's the journey from one to another and from the good to the great. For your business, this journey is a digital transformation. It begins along the pathway you decide.

Will you go alone through the noise and digitize this and digital that? Or will we travel together from progress to possibility? The right banking partner knows that you lead the way. It's there to embrace what makes your business unique.

It makes what's complicated simple. It collaborates to innovate, understands what's at stake and the obstacles you will overcome to build a digital bridge together. At U.S. Bank, we meet you right where you are, wherever you are in your digital transformation. In this partnership, your journey will be yours and ours to share. From simple steps with traditional tech, to giant leaps with cutting edge solutions, we listen.

You strategize. We'll collaborate. You'll optimize, because a trusted partnership is the foundation for greatness.

There's a banking partner who builds with you together to help you know what's next and how to get there, a banking partner to join you on your digital journey who doesn't tell you where the digital bridge leads, but asks. Where can it take you? With U.S. Bank, that's a journey worth taking.

So connectivity, it really seems easy in our personal life to connect to businesses and even to our bank. I mean, you can use your phone literally for everything, buy groceries, pizza orders, Uber for a ride, pay a bill or a friend. But we expect simple and easy ways to connect in our personal lives, and that is flowing over into our business lives as well. And we know that that's what you expect from your banking partners.

So over my 25 years in treasury management, I've had hundreds of client conversations about how to connect with the bank. And it's usually been either a data transmission or a digital form via online banking. But this experience will tell us, when it comes to implementing or implementation of some type of connectivity or connection, it's often been the most complicated and time consuming part of bringing on a new solution, almost to the point where everybody goes, oh, so.

Over the last year really, what I've noticed in our discussions with you and your other practitioners about optimizing your business processes, solving for simple and easier ways to connect with us has become a much bigger focus. So you want to know how you and your business can take advantage of the flexibility in the technology we have in our personal lives to modernize your business, improve your client experience, and provide you and your treasury team with better and faster tools. So today, Harsh, Kasi, and I want you to leave this discussion with answers to these three questions.

First, what channels are available to you to connect with us easier, faster, real time, on-demand, not action schedules. Second, what will each of these channels sell for, and why are they a value to your business? And then, you know, how our other businesses are using these in their treasury and their AR and AP. So you really want to know what's happening. How are they doing that?

And then the third thing is, what gaps exist that you'll need to consider and how you can manage your IT and banking partners to build these digital bridges for connectivity? So Harsh, maybe we will have you start by introducing yourself and explain the API connect to the channel.

Sure so hi, everyone. My name is Harsh Savaliya. I'm a product manager with the treasury management business. And I work with our open banking and innovation teams to create new channels for clients to use when connecting with the bank. I also work on ways clients can purchase new products, as well as the next generation of payment products.

API stands for Application Programming Interfaces. And think of these things as bridges. So bridges allow you to take people, good vehicles from one location to another location. And APIs are somewhat of a similar fashion. Let two systems connect so that they can share data and requests across each other.

Now, this sounds pretty simple. And you're probably thinking, well, what's the big deal? Well, think about it using this analogy. I live in New Jersey, and I work in New York. To get to New York, I have to cross the George Washington Bridge.

Now, I spent hours on end locked in traffic, sometimes late to work, have a terrible experience and a bad start to my day. Well, what if New York and New Jersey maybe created a bridge or tunnel or a hyperloop between my house and exactly where I wanted to go in New York, and then any other places that I wanted to go.

How awesome would it be? I wouldn't have to sit-in traffic. I would have a great experience getting to work. I'd be very efficient, very effective at work. There would be really low congestion in New York City because now people are going directly where they need to be.

So using the same mindset, APIs are this bridge or this tunnel or the hyperloop that essentially connects your applications, your systems, whether you're using them internally to run your business. You're using them externally with your customers. And they plug them directly into banking services.

And this is great because it helps you automate a lot of manual processes. It helps you bring a lot of efficiencies to your business. It helps you improve existing products or services or create brand new ones.

And really for this reason, a lot of digital native companies, whether it's Google, Amazon, Facebook, Expedia, they're all using APIs below the glass. Whether you see them or not, they're working really hard to make your customer experience the best that's possible. Now, we are bringing these APIs and enabling our banking services so you can use them with the customers.

So maybe that's a little bit enough about APIs. Let me toss it over to Kasi who's going to talk to you guys about an exciting bridge she's working on with ERPs. Kasi, over to you.

Thanks Harsh. So what I've learned in my last 12 years within treasury management, both from the payables and the receivables perspective is based on great products and services to offer you to help you achieve automation and to start using new methods for maybe payment origination, moving from paper to electronics.

So there are great trends and great solutions that we offer. But we presented you with a place historically to say, you can choose from this file transmission where you need to understand our mapping specifications, go through testing, and get over this large hurdle at the beginning of your implementation in order to achieve that automation. Or conversely, we've set you up on our banking portal so you can start using our products and services really quickly.

But then you have to have manual AP and AR processes and procedures because you have that quick setup. So again, historically, it's been a choice. Do you want a long implementation, a lengthy IT project? Or do you want sort of ongoing manual processes and procedures in your various departments?

So you want to take those trends and really turn them upside down. How can we get you that automation very quickly without that lengthy IT setup? And that's how these ERP connection strategies are coming into play.

So how can we, taking that cell phone that we have in our hands all day every day, we want to order a pizza, so maybe we download Uber Eats on our phone. How can we take that same concept, and when you're in your ERP system, your accounting software, download a banking application. Or maybe you need some of the products and the features within a banking portal like secondary approval.

If you're a little bit more risk averse and you want separation of duties from somebody who's initiating a payment to then going into banking portal and approving that. But you don't want that manual process to get that data into the banking portal. So now there's these think experiences where the data sort of automatically shows up into a banking portal.

You've done a one time connection. And now you're AP and AR department have this very seamless integration back and forth. And so that's what we're trying to do with these new ERP connectors is take what we've learned and the experiences that our clients have had and improve them. So it's much more modern. It feels very intuitive like you're using an app on your phone. But it doesn't take you six months to start using our banking products and services.

I like that auto-magical, Kasi. I think we should make that a new term in banking, all right. So let's think about for all of us, where are you and your company strategically in your efforts to modernize and digitize the business? So what are you thinking and planning for optimizing your operations, your treasury area, AP or AR?

So how connecting to your bank impact those plans, evaluating your current methods, considerations for newer channels, what pain points will it solve for? How is it going to benefit your business? So the best way I know to work through these questions is to look at some use cases. And so, Harsh, I thought maybe if you could share just a few use cases that we've seen and experienced with APIs and what would it solve for, and what's the advantage behind it.

Sure, so we have a large retailer who had many employees spend hours each day pulling balances from various online banking portals. And then they would use these balances to create cash forecasts or cash positions. Now, obviously the downside to this approach and method is now you have people spending hours, manual hours pulling this data. And this is where an API can come into place.

You can use our corporate account information API to pull balances and transaction details directly from U.S. Bank and to any of your applications. So you can really automate that cash forecast or cash position in saving a lot of the time, money, and effort that you spend manually pulling in the account balances or transaction details. So that's one way a client is looking to use APIs.

Another way a client could potentially use an API is think about it this way. If you're a title company, and you're looking to grow revenue, what's the easiest and quickest way usually to do that? Well, it's to get more brokers in the door to refer you business. And the best way to do that sometimes is incentivizing these brokers for bringing you business by paying them quickly, efficiently, right away after that deal closes rather than waiting a week to send a check or having someone drive over to a broker's office, handing over a check. And now the broker has to spend a few days depositing the check and then waiting for the balance to appear on their account.

So in this situation, what we could do is use our dispersant VSL API to directly plug into your application. So that soon as a deal closes, you can have money into the broker's account within seconds. So no more waiting a week or a few days to get that money into the broker's account. And now they're more incentivized to bring you business. And this could potentially create a competitive advantage for you.

That's fast, and that's easy. Kasi, let's just talk a little bit about then how ERP connectivity, how that is working, maybe some examples, and what it would solve for.

Yeah, so when it comes to ERP connectivity, one of the things that makes it work is the trends on the ERP systems themselves. So as they're going from more older versions that are stored on clients behind your firewall and on your servers and more towards cloud-based versions, meaning, you can access your accounting software from any browser that you can access.

So if you are on the beach, you can log into your ERP system. If you are in the office and you can access a browser, you can do that just the same. So I think from a business perspective, when you're thinking about your ERP system and how you deploy that, some of the benefits that come along with this cloud-based version.

And what that means from a banking perspective is we can learn from this cloud-based version where there's a lot less customization that we're seeing clients using them for and then being able to learn them a lot faster from the banking perspective. So when we want to offer an embedded application, for an example, or have a real-time sync of data from the ERP into banking portal, that really makes it a lot easier for us to achieve the automation on your behalf really. Because now we've been able to learn much more about your system.

I think in that, there is an inherent disadvantage if there are older accounting softwares out there. Or maybe your processes do rely on batch. And so there are still ways that we can connect to your ERP system in these more traditional models. But as we're going into more modern experiences, having that really critical from the bank to learn and understand your system and make that very easy.

So I was thinking about the traditional methods. So we can't leave those behind, you know, data transmission, and then the digital file upload. But they have been around for a long time. I mean, data transmission started back in 1975.

I wasn't in banking yet. I may look like it, but not quite yet, and then the digital connection channels as well. So that transmission capability, I think probably one of the best examples was when clients wanted to have us capture data from their remittances in our lock box area, transmit it to them so that they could use some front end software to automatically apply cash, much faster, and they have access to the cash sooner and they recognize it on their books. DSL goes down.

But you know, when clients didn't really have the means to take on that channel, pretty complicated, the FTP protocol was developed. That was in, I think '85. And you could then upload and download files on online banking platforms. And that really became what we call the digital channel.

And I'm thinking, during the pandemic, that digital channel really enabled so many companies to be able to outsource check production to the bank because it was fast, and it was easy and a very low IT need for it. So it's important to your business because there are times when you need to be able to use these kinds of applications. Data files could be structured or unstructured.

They could include documents. I'm thinking of like multimedia graphics, texts, PDF. We're starting to see the activity with the whole DocuSign capability and document exchange. So they can be shared easily inside or outside the enterprise. They've got low digital complexity. And there's no bills required.

So why is it important for your business? It's commercialized. It's got low IT support. So many, many companies choose that route.

So this digital connection for many businesses has a time and a place for the usage. But I do think there's an opportunity to be able to blend these or use these for various types of problem solving. Of course, what should those of us practitioners-- I'm still a banker-- who are listening, be aware of or consider if they want to use APIs?

So the thing to keep in mind with APIs is they generally require a little bit of build from your end in order to integrate them with your applications. However, what we've done is try to make our APIs super easy to understand so you don't have a tough time integrating them into your applications. You'll also need a little bit of your development bandwidth to do this.

OK, so if you had to approach IT, what are you going to say?

Yeah, the best thing to do is to think about ways where in your current processes or current products having banking services could really benefit you. So come up with maybe a use case that you can think about when you want to use our API.

And then you can direct your tech teams directly over to our U.S. Bank developer portal where they can look at our API capabilities to really enable that use case that you're thinking about. So that's really the best way to usually approach these.

And Kasi, what would you think that we need to consider, and then how to approach IT when it comes to ERP connections?

Yeah, I think the biggest question is, what kind of accounting software are you using? Do you have an app store like concept where you can access banking plug-ins or applications directly from within that? Are you using a cloud-based system?

And inserting from that perspective, if you're not, and you're considering upgrading your ERP system, maybe this is a compelling reason to use a more modern cloud-based version because you now have access to your downstream partners, banks included right, in order to connect with us in a more seamless fashion.

But also thinking through to your processes and procedures, how do you want to and how do you envision partnering with banks? And do you need banking portals? Do you need more real time experiences? And then exploring from that end, how can we partner together?

We do have an Innovation Studio dedicated to ERP connectivity. And that's something that we are continuously looking to do is to learn from clients on, how did you get the connection set-up? What went well? What didn't go well?

Collecting that feedback from those who are involved, and then sharing it with banking partners. But then also telling us like, this is how I want my experience to be. I do need an app in my ERP system so that you appear on my home screen.

And this is the functionality that I'm looking for. I think, all of that combined will lead to really great ERP connections. But this is very new, Nina. I think within the last one or two years, we're starting to see ERP systems and bank partner together this way.

So it's a continuous evolution. So you might be looking for something we don't have quite yet. And that's where the partnership really does come into play.

So just for the interest of time, let me just kind of pull these things together from our beginning three questions. Our approach, really, would be to help you to close the gaps that you have right now in connectivity. So we want you communicating with us in the easiest and best way for your business needs. We had a talk about that, and within your systems capabilities, and with the time that you have available. So those are all major pieces.

And then when I think about it is that use case that Harsh talked about, if you want to use more digital solutions, then you've got to be able to take advantage of some of these types of connections to be able to do them with low risk and to provide a better experience for your customers.

So really, connectivity should be simple, easy, effective, and efficient. You need a proactive banking partnership for good connectivity. They need to be relevant. They need to be reliable. And they need to be high touch service.

And then connectivity really should be collaborative innovation, so client first. Direct integration as much as possible with your systems so that you are empowered to make the decision of how you want to do it, not how the bank says you have to do it.

So now that you have an understanding of the channels and how they can be used, what will you need to consider? What are the possibilities for your business? I encourage you to use your cell phone.

You'll see a QR code come up here on the screen. Capture that. It will take you too many resources that we have on connectivity at the bank and certainly will provide you with articles and how-tos and even access to the developer portal. Thanks for your time today.