Host to Host Banking

The simplest channel is the bank's own electronic banking portal, one per bank, where someone uploads the file by hand. For a group with many banks this gets expensive: an article in The Global Treasurer put the yearly operating cost of one electronic banking platform at more than 10,000 euros, and a mid-sized multinational may maintain hundreds of user profiles across its banks.

The second channel is a host to host link to each bank, which the company's system uses to send and receive files automatically. The third is a network that reaches many banks through one connection, which for corporates usually means SWIFT. BNP Paribas shows all three channels behind a payment factory in its summary on payments centralization.

EBICS, the Electronic Banking Internet Communication Standard, is the common standard of banks and their corporate customers for payments, account statements and administration in Germany, France, Switzerland and Austria. Banks also use it among themselves and with clearing houses. Its distributed electronic signature lets several authorized people sign a payment order from different places and at different times, so a file sent by the system waits at the bank until the second signature arrives. The second signature is also a control against fraud, as the CEO fraud page explains.

A corporate that joins SWIFT can reach its banks over the network that connects more than 11,000 financial institutions, according to Wikipedia. The 2010 article in The Global Treasurer counted over 600 corporates on SWIFT and named the access models: SCORE, Alliance Lite and service bureaus. Alliance Lite2, the cloud-based option, is aimed at customers with low volumes.

At a 2015 roundtable reported by Treasury Management International, Johnson Controls said it required SWIFT connectivity from its banks and used ISO 20022 formats, for over 350 entities and 100 banks. Treasurers on the panel saw no alternative to SWIFT and expected its prices to stay high. The ISO 20022 migration page covers the message standard, and the SWIFT gpi page the tracking of cross-border payments.

Finance Loop is the meeting place for treasurers, cash management bankers and the IT people who connect a treasury to its banks. It connects the finance, IT and AI communities in Germany, Austria and Switzerland, with events in Frankfurt, Munich, Berlin and Hamburg.

Finance Loop supports When Banks Say 'No', a half-day payments seminar in Frankfurt for compliance, treasury, finance, export and legal teams on blocked payments, de-risking and sanctions. Finance Loop is also media partner of Capital & Code, a Frankfurt conference whose audience includes corporate treasurers who manage liquidity and risk.

Host to host banking is an automated file connection between a company's system and its bank. Payment orders go to the bank and statements come back without manual upload through an online banking portal.

EBICS is a communication standard for the connection between a company and each of its banks, used mainly in Germany, France, Switzerland and Austria. SWIFT is a network that connects a company to many banks worldwide through one connection.

No. Many companies in Germany reach their banks over EBICS. SWIFT pays off for groups with many banks in many countries, and Alliance Lite2 is the entry option for low volumes.

Multi-bank connectivity means that one system, often the ERP or treasury management system, sends payments to and receives statements from all of a company's banks through a common channel, instead of one portal per bank.