Goldman Sachs to Compete for Corporate Cash Management Services
(16 June 2020 – United States) Goldman Sachs have moved into corporate cash management, marketing new bank accounts for corporates in need of cash management solutions.
The bank has traditionally focused on complex trades and high-stake mergers, however the investment outlook for many corporates has been clouded by economic uncertainty. As a result the bank’s CEO David Solomon is seeking to reposition the bank and its services amid adverse market conditions.
The bank aims to take on leading commercial banks who currently have large market share in the cash management space. Last year alone saw banks take a share of cumulative profits worth US$32 billion for banks offering this service, proving a highly lucrative market.
Cash management services generate revenue through three main channels:
- Lending against corporate deposits
- Account fees and charges
- Currency exchange fees
Goldman Sachs plans to make US$1 billion in revenue from its new account services and cash management offering by 2025.
“As long as cash is still in circulation, there will always be a need for businesses to store and manage cash in the best way possible - especially during times of crisis” stated East & Partners Europe Market Analyst, Pierre Sokoya.
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