The Cash Management Services in the US

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Cash Management services refer to a range of services that are usually provided by a bank such as checkbook balancing, zero balance accounting, cash investments, cash concentration, and automated transactions among others (Shulman and Cox, 1990). As such the nature of cash management services that are available in the market tends to differ across the board; however, they essentially involve easing the cash payments and receipts transactions for organizations and are mostly offered to corporate clients but also for individual clients as well.

Collectively, cash management services can be described as any bank product that facilitates cash transfer between businesses, notably payments from creditors, payment to debtors, or other cash management tasks in general such as investing (Shulman and Cox, 1990). From a broad perspective, cash management in an organization is a form of short-term management of its liquidity assets. In this paper, we are going to discuss the various types of cash management services that exist in the market by comparing the nature and types of cash management services that are offered by three banks in the United States.

There exist many cash management services in the banking industry that are routinely offered to consumers, some of which would appear as standard bank services since they are available in any local bank. For instance, concentration account and controlled disbursement are among the most common types of cash management services that can be found in virtually any decent bank that has Organizations as their clientele. A concentration Account is a form of a final destination for all funds that are collected from various creditors before it can be managed, while controlled disbursements is a single account that is designed to balance the rate of incoming funds from creditors with the rate of outgoing funds to the company debtors (Shulman and Cox, 1990).

The advantages for using these services of cash management are several as well as convenient especially to large organizations that have high transaction rates between debtors and creditors. In health care organizations, these benefits are extremely important and cannot be overemphasized, this is because timely payment to debtors for example ensures that medications shipments arrive right on time, thereby saving lives and probably preventing spoilage that is likely to occur when they are on shipments. More importantly, cash management services enable Organizations to function and operate efficiently and therefore prevent them from becoming insolvent or bankrupt (Shulman and Cox, 1990).

But since cash management services are good business practices, their application has other benefits since they facilitate suppliers’ payments on time, thereby attracting certain discounts which translate to a high-profit margin in the long run. In the short term, an organization is effectively insulated against financial risks that emanate from poor cash management. In the preceding section, we are going to compare the cash management services for three local banks.

Peoples Bank

The Peoples Bank is a financial institution that is based in South Mississippi where it operates 16 branches. Its cash management system is tailored around the concept of saving time and cash, business transaction facilitation, and information technology support, part of its mission statement is “making the impossible possible” (, 2010). It has a total of 8 cash management services that it offers both to commercial clients as well as private customers, they include funds management, recon services, account analysis, sweep accounts, wire transfers, positive pay service, merchant deposit capture, and ACH origination (, 2010).

A funds management account is essentially a general account but which attracts higher interest rates than ordinary accounts thereby providing commercial clients the benefits of generating money while the money is on hold. Companies that have high financial turnover are especially likely to benefit from this banking product since the amount of interest generated will also be significant. A sweep account on the other hand is a form of several seamless accounts merged that allows free movement of cash that is not restricted by procedural oversights such as cheques and manual deposits thereby saving time and energy required to do so.

Recon Services is an easy-to-use system designed for customers with large daily transactions to facilitate accounts reconciliation. Perhaps, one of the unique cash management services that the bank has is Positive Pay Service, it is a system that automatically checks the validity of all financial transactions and enables the client to authorize transactions in real-time. The Merchant Deposit Capture also seems to be an innovative cash management service since it enables a client to enter any form of deposit details on an electronic gadget that transmits payment.

Bank of the West

This is one of the largest financial institutions in the United States with assets that are more than $60 billion and business operations in 20 States (, 2010). It is also a subsidiary Company of BNP Paribas which is a leading global financial institution.

The cash management services for this bank are tailored to maximize profit for clients at every step by regulating cash flow and streamlining transactions. They have a total of five cash management services which include WebDirect, Payables Management, Merchant Services, Receivables Management, and Account Services (, 2010).

WebDirect is an online program that enables a client to manage cash transactions remotely from an online portal; Payables Management is similar to WebDirect in that its streamlines and facilitates payment to debtors but without an online portal. Merchants Services is a one-stop-shop for a range of specific payment processing services that are mostly utilized by commercial clients. Receivables Management is designed to facilitate incoming cash that is collected in a single account or several such accounts according to the customer’s requirements. Finally, Account Services is a form of a general financial advisory service that is offered to corporate clients that operate other cash management services with the bank.

Citibank Financial Center

This is one of the few banks that has a wide range of cash management services for its clients which are broadly divided into three groups: payments, collections, and investments categories (, 2010). It is by far the only bank that offers more than five cash management services in each category. In the payments category, the bank cash management services include credit cards, funds transfer, positive pay, account reconciliation, controlled disbursements, matched pay, and automated clearing house origination (, 2010).

The second category is cash collection services that include remote check deposits, merchant card processing, lockbox, deposit reconciliation, currency services, and wire transfer (, 2010). Finally, there is the investment category which has three cash management services: zero balance account, investment sweeps, and online investing (, 2010).

The most notable cash management services that put this bank in a class of its own are its investment sweeps, online investing, and currency services. The currency services provide organizations with logistical support for the transfer of large amounts of money using armored vehicles to safeguard its delivery, this service will be most ideal to a health care organization when transferring cash from a site to the bank. The investments services are also very impressive, investment sweeps are especially handy since they provide a Company with a range of investment opportunities overseas to choose from and transfer the funds using online investing services which allow real-time management. It is for these reasons that I would choose Citibank as my preferred financial partner due to the nature of their cash management services.


BankoftheWest. (2010). Cash Management. Web.

Citibank. (2010). Cash Management: Keep your Money Moving. Web.

Peoples. (2010). Cash Management Services. Web.

Shulman, S., & Cox, R., (1990). An Integrative Approach to Working Capital Management. Journal of Cash Management. 13(2), 78-93.

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