Integration of Electronic Foreign Exchange Trading and Corporate Treasury Systems with Web Services

Hedging foreign currency risk is a central task for treasuries of multinational corporations. Traditionally, it has strongly relied on voice-based broking. With the advent of Internet technology, online platforms for foreign exchange trading emerged offering corporations a single point of access to the liquidity of a global market. However, online marketplaces only become truly valuable if seamlessly integrated into the corporation’s hedging process. This paper evaluates the strengths and weaknesses of multi-bank online marketplaces, identifies the demanding and complex integration challenge and presents a Web Services-based straight-through processing implementation as a manageable approach to integrate online marketplaces and corporate treasury systems.