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As businesses worldwide continue to navigate the increasingly complex financial landscape, the role of effective cash management is growing in importance. With 2025 approaching the horizon, companies are facing new (and not-so-new) challenges and opportunities in this space. Driven by technological advancements, economic volatility, and evolving regulatory frameworks, corporate cash management has its plate full.
2025: Cash management for the future
To investigate the trends and gain insights into the future of cash management, I sat down with Jukka Sallinen, CEO of Nomentia, a leader in cash and treasury management solutions.
Meet Jukka Sallinen, CEO of Nomentia
Jukka Sallinen has been at the helm of Nomentia since 2021, but his roots with the company go back much further. He joined the company in 2006, gradually moving up the ranks to become the Head of Cash Management Business before taking on the CEO role. His deep knowledge of the industry, combined with a passion for history, gives him a unique perspective on the evolution of digital banking and cash management.
Drivers of cash management – perspective on the new normal
Economic uncertainty and geopolitical tensions put pressure on cash management to deliver
As we approach 2025, it’s plain that among the primary factors driving cash management are uncertainty and ongoing geopolitical tensions. In stark contrast to the pre-pandemic business environment, businesses today are operating in an environment where unexpected disruptions, like supply chain issues or political instability, can have immediate and far-reaching impacts on cash flow. In addition to interest rate hikes and access to funding in general, Sallinen highlighted market volatility and inflation as significant influencers. 'The ongoing economic uncertainty,' he noted, 'is pushing companies to be more agile and resilient in their cash management strategies.'"
Now more than ever, it's vital to strive for efficiency. “The world has become more interconnected and complex, but this has also made it more volatile,” Sallinen noted.“The pandemic was a wake-up call for many,” Sallinen continued.
“The pandemic showed us how quickly things can change and how critical it is for businesses to be more proactive in their cash management strategies. This is why more companies are investing in technologies and tools that allow them to react quickly to changes, whether it's a sudden drop in revenue or a spike in operational costs."
Technological advancements in cash management
Even a precursory glance at the first half of the decade proves unequivocally the way digitalization has broken barriers on many fronts. Among a plethora of other buzzwords, Crypto, NFTs, Metaverse, and Web3 have all made their way into the common lexicon, only to disappear just as fast. In contrast, particularly in the world of cash management, the cloud, automation, and APIs have proven their staying power more effectively. Sallinen brought up the rapid advancement of technology, automation, and artificial intelligence, as one of the significant drivers of change in cash management. “Increasing automation has been a key topic for quite some time, but there’s still much to explore in terms of its capabilities and the impact it can have across cash management and treasury,” he said. “If we learn to harness it, it’s not just about efficiency it's about survival. In an unpredictable environment, it's critical to be able to analyze data quickly and make informed decisions."
Sallinen emphasized that AI, in particular, is likely to play a growing role in cash management. “By many accounts, AI is transforming how we approach everything from risk management to fraud detection,” he explained.
“For example, we’ve seen examples of how AI can help identify patterns that a human might miss. It’s obvious that these functionalities can be harnessed, for example, to detect unusual transaction activity that could indicate fraud. On the other hand, all technologies have their uses for bad actors as well. AI has already been used to perpetrate fraud, which is likely to lead to increased pressure for action from regulatory institutions.”
Regulatory changes and compliance drive change
Security and compliance are two areas that Sallinen believes will become increasingly important as we approach the latter half of the 2020s. The rise of digital payments has made security a top priority for businesses. At the same time, though, the increasing complexity of regulatory frameworks means that companies need to be more vigilant than ever when it comes to compliance.
“Regulation is a double-edged sword,” Sallinen said. "On one hand, it's necessary to ensure the stability and integrity of financial systems as a whole.” As the digital business landscape has evolved, increased regulation has also made it easier for businesses to adapt best practices and principles company wide. On the other hand, regulations can create notable challenges for businesses, especially when regulations vary from one country to another. Amidst compliance demands, improving cash management processes through centralization becomes a balancing act between central control and local autonomy.
“Compliance is no longer just a box to check,” Sallinen remarked. “It’s a critical component of a company’s overall strategy. Businesses need to be able to adapt to new regulations quickly and efficiently, or they risk falling behind.”
Sallinen explained that one of the biggest challenges facing businesses today is the threat of cyberattacks. “Cybersecurity is a constantly evolving field,” he said.
“We’ve seen that as businesses become more digital, they also become more vulnerable to cyber threats. It’s essential to stay ahead of the curve."
Liquidity and cash flow management at the center stage
One of the most pressing concerns for businesses as they look toward 2025 is liquidity management. Sallinen stressed that accurate cash flow forecasting is more important than ever in today's volatile business environment. "Liquidity is the lifeblood of any business," he said. "Without it, even the most successful companies can find themselves in trouble."
He explained that the key to effective liquidity management lies in having access to up-to-date data. “Relying on outdated information is no longer an option,” Sallinen emphasized. “Visibility to accurate data is crucial. Companies must know where their cash is and where it’s going and be ready to adjust their strategies fast.”
Sallinen also brought up the role of automation in improving cash flow forecasting. “Automation allows businesses to process large amounts of data quickly and accurately,” he said. “This not only improves the accuracy of forecasts but also frees up valuable time for treasury teams to focus on more strategic tasks.”
A question of working capital optimization
Another trend in the global economy is the growing focus on working capital optimization. Companies are increasingly looking for ways to improve their working capital metrics, particularly in the wake of the economic disruptions caused by the pandemic. “Working capital optimization is about finding the right balance between liquidity and profitability,” Sallinen said. “It’s about making sure that your assets are working as hard as they can for your business.”
Sallinen went on to describe some of the strategies that companies are using to optimize their working capital. "One approach that we've often is centralizing cash management and treasury operations,” he said. “By bringing all of your cash management activities under one roof, you can improve visibility, reduce costs, and make better decisions.”
Cash management professionals and treasurers are increasingly placing greater emphasis on optimizing payables and receivables to enhance operational efficiency and financial stability. The ability to accurately track cash movement has become increasingly crucial, as it aims to ensure liquidity at the right time helps avoid reliance on external funding sources, often accompanied by unfavorable terms. Beyond liquidity management, this drive to optimize extends to mitigating risks that could impact overall financial health. Risk management strategies, like hedging and the use of various financial instruments, play a vital role in protecting against currency fluctuations, interest rate volatility, and other financial uncertainties that can erode working capital.
Centralization and standardization
Centralization is a theme that came up repeatedly in our conversation with Sallinen. He emphasized that centralizing cash management operations is not just a trend but a necessity for companies looking to improve control and security. "Centralization allows for greater standardization of processes, which in turn leads to better data accuracy and more informed decision-making," he said.
Sallinen pointed out that many companies are still operating with fragmented cash management systems, which can lead to inefficiencies and increased risk. “When you have multiple systems in place, it’s difficult to get a clear picture of your overall cash position,” he explained. “This can lead to mistakes and missed opportunities. By centralizing your operations, you can ensure that everyone is working with the same information, which reduces the risk of errors and improves overall efficiency.”
He also discussed the importance of standardization in the context of global operations. “For companies that operate in multiple countries, standardization is key,” Sallinen said.
“Centralization ensures that everyone is following the same processes and using the same tools, which makes it easier to manage cash flow across different regions.”
Automation, AI, and APIs
As businesses prepare for the challenges of the second half of the 2020s, Sallinen emphasized the importance of embracing automation in cash management. “Automation is increasingly no longer optional,” he said. “It is an essential tool for any company looking to stay competitive in today’s market.”
He explained that automation can help companies streamline their operations, reduce costs, and improve accuracy. “By automating routine tasks, companies can free up their treasury teams to focus on more strategic activities,” Sallinen said. “This not only improves efficiency but also helps to reduce the risk of human error.”
Sallinen also brought up the future role of AI in improving cash management. “Eventually, AI can help companies analyze large amounts of data quickly and accurately,” he said. “This should result in better decision-making and improved risk management.”
Building a resilient foundation for evolving cash management
Sallinen stressed the importance of building a resilient cash management foundation to weather the emerging challenges of 2025 and beyond. “Resilience is about being prepared for the unexpected,” he said. “It’s about having the systems and processes in place to respond quickly and effectively to changes in the market.”
He explained that one of the keys to building resilience is having a flexible cash management system. “A one-size-fits-all approach doesn’t work in today’s environment,” Sallinen said. “Companies need to be able to adapt their cash management strategies to meet the unique needs of their business.”
Sallinen also discussed the importance of collaboration in building a resilient cash management foundation. “No company can do it alone,” he said.
“It’s essential to collaborate with internal stakeholders, but also with partners who understand your business and can help you navigate the complexities of the market.”
Cash management – back to basics?
While much of our conversation with Sallinen focused on the role of technology in shaping the future of cash management, he also stressed the importance of returning to fundamental principles. "Technology is a powerful tool, but it's not a substitute for sound financial management," he said. "At the end of the day, it's the basics that will see you through the tough times."
Sallinen explained that one of the core principles of cash management is liquidity management. “Liquidity is the foundation of any business,” he said. “Without it, even the most advanced technologies won’t save you. That’s why it’s so important to maintain a strong focus on liquidity, especially in today’s volatile environment.”
He also emphasized the importance of risk management. “Risk is a part of doing business,” Sallinen said. “But that doesn’t mean you should be complacent. A proactive approach to risk management can help you identify potential problems before they become serious.”
Sallinen suggested that companies take a holistic approach to risk management. “Look at the big picture,” he said.
“Consider all the factors that could impact your cash flow, from economic conditions to changes in regulation. By taking a comprehensive approach, you can better protect your business against unforeseen challenges.”
The human element in cash management
Sallinen explained that one of the biggest challenges facing businesses today is finding the right balance between automation and human oversight. “It’s easy to get caught up in the excitement of new technology,” he said. “But it’s important to remember that technology is a tool, not a replacement for human expertise.”
He suggested that companies invest in training and development to ensure their teams have the skills they need to succeed in a technology-driven environment. “Continuous learning is essential,” Sallinen said.
“As technology evolves, so too must the skills of your team. By investing in training, you can ensure that your team is equipped to handle the challenges of the future.”
Navigating the future of cash management
As our conversation with Jukka Sallinen ended, it was clear that the future of cash management brings both challenges and opportunities. From the rise of automation and AI to the increasing complexity of regulatory frameworks, businesses must navigate a rapidly changing landscape. However, by embracing new technologies, building resilience, and staying true to core principles, companies can not only survive but thrive in the years to come.
Sallinen’s final advice for businesses looking ahead to 2025 and beyond was simple but powerful: “Stay adaptable, stay informed, and never lose sight of the basics,” he said.
“The future of cash management is constantly evolving, and those who are willing to embrace change while staying grounded in sound financial principles will be the ones who succeed.”
Building better cash management with Nomentia
In line with his forward-thinking approach, Sallinen encouraged businesses to explore the tools and solutions that Nomentia offers. “At Nomentia, we’re committed to helping companies navigate the complexities of modern cash management,” he said. “Our integrated solutions are designed to provide visibility, automation, and security that businesses need to stay ahead in today’s market. I invite companies to learn more about how we can support their journey toward a more secure and efficient future.”
