This week, Capgemini has released its highly anticipated World Payments Report 2023 which expanded its traditional focus on retail payments to cover a broader spectrum of opportunities when it comes to cash management. The report predicts that the non-cash transaction volume across the globe will reach 1.3 trillion by 2023 and 2.3 trillion by 2027. Capgemini finds that 56% of total global payments value is attributable to commercial payments, outpacing the spend on retail payments. In fact, over one in two respondents agreed that commercial payments offer better profit potential than retail payments. Cash management remains a constant and important challenge for corporations facing macroeconomic headwinds and uncertain growth, and it is becoming increasingly important for banks to tighten their oversight and better understand their overall banking revenue. The report quotes Marc Andrews, vice president, financial services and insurance industry market leader from Pega, who explained: “Commercial banking has been slower to implement digital automation and engagement capabilities in general. However, things are beginning to change as their clients seek real time transparency into payment status and faster response to requests.” The main challenge for banks outlined by Capgemini is the ability to finance strategic initiatives for digitalisation. While cash was historically easily accessible for large enterprises, surging interest rates have led to an increase in the cost of debt and firms are now refinancing and trying to manage growing interest expenses. Highlighting this challenge, the report also found that a large number of respondents stated that 90% of their budget is spent on business-as-usual processes, preventing them to invest significantly into innovation for transformation. Jeroen Hölscher, Capgemini’s global head of payment services, says: “This presents a foundational struggle for the industry which is trying to manage innovation, competition and back-end optimisation against the background of a highly-regulated environment.” Regulatory changes were identified to have an additional impact on a firm’s bottom line, with those surveyed stating that managing risk, regulatory compliance, and scheme compliance comprises 36% of total payment business costs.