e-Financial Supply Chain: An Attainable Summit

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27 January 2004


San Francisco, CA, USA January 27, 2004

Part I of III: Banks' Potential to Lead the Trek

Banks must take a leadership role in the migration of businesses financial supply chain to the electronic realm. If not, they risk being relegated to the low-margin payment clearing and settlement business while non-banks win in high-margin, information-related businesses.

In a new report, , Celent examines the opportunities for banks to expand their role in the financial supply chain, from purchase order to payment settlement and reconciliation. Within their historical stronghold, electronic payment-related services promise profits that eclipse those of traditional paper-based services. The most lucrative opportunities, however, lie not in banks historical domain but rather in system integration and information-related services. Banks can add significant value by integrating their systems into their clients ERP/accounting systems, building a critical electronic bridge over a manual abyss.

According to

Alenka Grealish, author of the report and manager of the banking group at Celent, "The greenfield opportunity is vast, but its not forever. In ten years, this green market will be mature; most companies will use e-invoices and e-payments. Banks must act soon to establish a long-run position because early movers will likely sustain an advantage based on their track records. Currently, slightly less than half of the top 20 treasury services banks risk being also-rans."

The report profiles the initiatives of five banks (Bank One, JPMorgan Chase, Mellon, U.S. Bank, and Wells Fargo) that are exemplary.

A is available online.

of Celent Communications' Wholesale Banking research service can download the report electronically by clicking on the icon to the left. Non-members should contact for more information.

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