BAML Launches Multicurrency Netting Tool

Bank of America Merrill Lynch (BAML) has announced that it has expanded its payments capabilities with the launch of multicurrency netting.

The new solution centralises inter-company payments, enabling large companies that operate across multiple borders to reduce both the number of payments and the total value of payments made between companies that regularly invoice one another, the bank says. 

Large corporations typically make hundreds of inter-company payments worth millions of dollars every month. In addition, they must handle invoices in numerous currencies issued by their own affiliates or with vendors that support more than one entity within the company. Many times, specialised programs are needed to help calculate what each entity owes the other. 

BAML says that by moving to a centralised netting solution, multinational companies can realise many benefits, including fewer wire transfers, resulting in lower bank and lifting fees; fewer local currency bank accounts and related expenses; reduced foreign exchange exposure and trade activity; and less time spent handling invoices and reconciliation tasks.

“The Multicurrency Netting solution introduced today is in response to direct input from our corporate and commercial clients who want greater visibility and control over their inter-company and vendor payments,” says Liz Minick, head of global cross-currency product and strategic client capabilities in BAML’s Global Transaction Services unit. “We are pleased to add this powerful cross-currency solution to our suite of FX payment tools.”

BAML adds that the new solution also includes a number of features that were specifically requested by clients. These include workflow and communication tools for invoice management; what it terms “competitive and transparent FX trading rates”; and comprehensive metrics and reporting, with direct updates to company accounting platforms.

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Colin Lambert

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