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What is Cash Management?

Cash Management

Managing Cash

Cash Management refers to the end to end process of managing cash. So right from collecting cash, then handling it and finally using it comes under the scope of cash management.

A lot of analysis is carried out in the process like analyzing the market conditions and the percentage of liquidity in various financial products. An in-depth knowledge of the flow of cash and the features of various investment products is required for the person who is responsible for managing the cash.

Cash Management by Banks

Banks offer cash management services to their high profile business clientele in exchange of a fee and offers the following services as a package:

  • Account reconciliation
  • Cash collection services
  • Balance Reporting
  • Automated Clearing House facility
  • Wire Transfer, etc

All these come with a cost, but the benefits of expertise, accuracy and delegation outweighs the same. The bouquets of facilities vary from bank to bank and also differs based on the business volume and business relationship with the customer. With stiff competition, these initiatives have become a necessity for banks to retain their prime customers.

Financial Instruments

The financial instruments that are part of cash management are money market funds, certificate of deposits and treasury bills.


  1. In a society where liquid funds are becoming less and less popular, it may pay to have this knowledge under your belt. Cash is not only easy to use, it is easy to manage and gives you access to your money almost immediately. Best to know the basics about liquid finances – this article certainly helps 🙂

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