Treasury Management for Governments

Banks are useful agents in managing transactions.  Why should a government invest in building a proprietary network for cash transactions when it can lease the newest technology from commercial sources?

Praxis: Cash -  Using commercial banks

Banking Services Procurement

The process of Begin by developing tenders for banking services.  The components of this process include:

• Document the current procedures
  
• Learn what is available
  
• Develop the tender documents
  
• Evaluate the responses
  
• Presentations and on-site visits
  
• Develop implementation plan and award contract
  

The steps for documenting the current procedures require a thorough review of how things are done today. Be sure to  look at:

• Review critical business processes
  
• Review current bank fees and transaction volumes
  
• Identify potential service gaps and improvement opportunities
  

As with most procurement, it is best to go into the environment aware of its potential.  Survey the industry broadly to learn what is available.  You want to understand the current environment for banking services.  Take actions such as:

• Requests for Information
  
• “Banking Fair”
  
• Conferences
  
• Independent research
  

Develop the Tender

• Create an overall vision for banking structure and services required
  
• Develop estimates of transaction volumes
  
• Inventory and assess specific concerns and issues for bank service requirements
  
• Determine list of banks to be included in Tender process
  
• Develop and issue the Tender
  

Evaluation

• Conduct quantitative analysis of tender responses
  
• Complete cost analysis on proposed pricing using the estimated volumes
  
• Determine a “short list” of banks to participate in the presentation phase
  

Presentations and On-Site Tours

• Schedule presentations and bank visits
  
• Evaluate the demonstrations formally and debrief after each meeting
  
• Conduct on-site tours of finalist banks
  

Award and Implement Contract

• Select the preferred bank(s)
  
• Develop overall implementation plan which includes:
  
  • Key project tasks and dependencies
    
  • Staffing and skill set requirements
    
  • Timeframes
    
  • Key deliverables
    

Advantages of using banks as financial agents.