Why Are Middle Market Companies Turning to AI in Treasury
Expanding a business across borders has never been more relevant. As companies grow, they face new challenges, such as managing cash in different currencies, keeping track of liquidity, and staying compliant with local rules.
What used to be simple financial management now requires sharper planning and stronger treasury systems. This is where real complexity begins for many growing firms, especially those stepping into global markets for the first time.
Sue Caras, who leads Treasury Sales for Bank of America’s Global Commercial Banking division, helps companies handle that complexity with confidence.
She works with multinational firms earning between $50 million and $2 billion annually, guiding them on cash management, liquidity, and foreign exchange strategies.
Sue’s approach is practical and focused on results. She helps companies design banking structures that make sense, manage cross-border risks, and operate efficiently in international markets.
This article’ll examine how growing businesses, especially middle market companies, can build strong treasury foundations for international success.
You’ll learn what defines these companies, how they manage global expansion, and how tools like AI are changing treasury operations. The goal is simple: to help businesses grow globally with clarity, control, and confidence.
What Defines Middle Market Companies and Their Treasury Approach Abroad
Cash management becomes a key part of its success when a company starts growing across borders. A middle market company usually sits between small businesses and large corporations.
It’s stable at home, but still learning to manage international growth. These firms often face the same financial challenges as large companies with fewer resources.
Image Credits: Photo by Vlada Karpovich on Pexels
First Treasury Decisions When Expanding Abroad
When a company moves into new markets, its treasury team must act quickly and smartly.
- Pick the right banking setup: Decide whether to use local banks, one global partner, or a mix of both.
- Handle currency risk: Currency fluctuations can hurt profits once money crosses borders. Use hedging to reduce that risk.
- Open the right accounts: Some countries require local accounts for payments or salaries. Others allow central control.
- Keep full visibility: Always know where your cash is. It prevents funds from getting stuck in one country.
These steps build a stable foundation and help avoid costly mistakes later.
What “Best in Class” Cash Management Looks Like
Top-performing companies keep things simple and connected. They have real-time visibility of their funds, automate payments, and use cash pooling to reduce borrowing.
Technology plays a big role. Modern treasury platforms let teams monitor accounts, currencies, and transfers across countries. That clarity helps companies forecast better and move cash where needed most.
Setting Up Representative Offices
When testing a new market through a small office, keep operations lean. Set clear rules for spending, approvals, and payments. Avoid unnecessary bank accounts that might complicate things later.
Why Relying Only on USD Can Be Risky
Invoicing only in USD seems easy, but it can push away local clients. It adds exchange rate pressure and makes pricing less flexible.
Using local currencies builds trust, strengthens relationships, and makes business smoother. It’s a small change that creates a big difference.
How Middle Market Companies Manage Treasury in Global Expansion
Middle-market companies earning between $50 million and $2 billion are uniquely positioned. They’re big enough to grow across borders, but not always large enough to have big treasury teams.
To manage this growth well, they need structure, visibility, and clear planning before entering new markets.
Image Credits: Photo by MART PRODUCTION on Pexels
Building a Strong Treasury Foundation
The first step is getting the basics right. Treasury teams should establish a clear banking structure and define who controls what.
They need real-time cash visibility to avoid surprises. Without that, even profitable businesses can face liquidity problems.
Foreign exchange management is another key part. Once money starts moving between currencies, risk follows. A solid FX strategy, through natural hedging or forward contracts, helps protect margins and keeps pricing stable.
Understanding Local Regulations
Each country has its own way of doing things. Some make money movements simple. Others need detailed paperwork or even central bank approval.
You can think of them as:
- Mild: Open, with easy fund transfers.
- Medium: Some restrictions and local requirements.
- Spicy hot: Complex, with limited access to funds or strict repatriation rules.
In stricter countries, money can only be sent out for specific reasons, like loan repayments or dividends. Knowing these rules early helps companies avoid delays and unexpected costs.
Managing Currency Risk and Working Together
A business should always know where money comes in and goes out. Mapping these flows makes it easier to spot and manage currency risks. Matching income and payments in the same currency can also reduce exposure.
Treasury teams can’t work in isolation. They must collaborate with sales, finance, and procurement to keep pricing competitive and margins protected. When everyone works together, international growth becomes smoother and more sustainable.
Best Treasury Practices for Middle Market Companies Going International
Expanding into new markets is exciting, but it also brings challenges. Treasury teams keep the company steady, manage money flow, ensure compliance, and keep everyone informed.
Image Credits: Photo by RF._.studio _ on Pexels
Setting a Clear Governance Structure
Start with governance. Every company needs to know:
- Who controls bank accounts, and who can approve payments?
- How money moves between countries and subsidiaries.
- What accounts are required for operations, payroll, and taxes?
Each country works differently. Some allow one account for all activities, while others require several. Having a proper structure gives visibility over cash and prevents compliance issues.
Automation should be a priority, too. Use treasury or ERP systems that support straight-through processing. The fewer hands that touch a transaction, the smoother and faster things run.
Balancing Global Oversight with Local Needs
Next, decide how the treasury will operate. A centralized model gives tight control, while a hub-and-spoke setup lets regional teams act faster. The choice depends on how large and complex the company is.
Local expertise matters as much as global reach. Work with banks that speak the local language and understand local rules. This balance between global systems and local knowledge keeps operations flexible and consistent.
Managing Mergers and Acquisitions (M&A)
When companies grow through M&A, the treasury’s role expands fast. After a deal closes, teams must:
- Update legal and trade registry records.
- Adjust or open bank accounts.
- Meet KYC rules for all authorized signers.
Set these steps early so there are no surprises later. Headquarters should guide, but local teams know the details. Both must share information clearly to keep operations aligned.
Preparing for Market Shifts
Markets always change. Tariffs, regulations, or currency swings can hit profits. Treasury teams should run stress tests and scenario plans often. That way, they can react quickly, protect cash flow, and keep expansion steady, even when conditions shift.
Smarter Treasury Operations for Middle Market Companies with AI
Tariffs and changing market conditions can hit company finances faster than expected. Treasury teams must stay proactive and flexible enough to handle those shifts without disrupting daily operations.
Image Credits: Photo by cottonbro studio on Pexels
Managing Tariff and Cost Volatility
When tariffs rise or exchange rates fluctuate, costs, currency stability, and liquidity all come under pressure. Treasury teams must watch how these changes affect profit margins and identify where the business is most exposed.
It’s also vital to keep extra liquidity ready since suppliers often respond by shortening payment terms or requesting advance payments.
That can squeeze working capital, so planning for additional cash reserves keeps operations steady even when conditions turn unpredictable.
Using AI to Strengthen Treasury Efficiency
Artificial intelligence is now an important tool for treasury teams. It helps process large amounts of data, cuts manual work, and provides faster insights for better decisions.
Two main applications are already showing strong results:
- Cash Forecasting: AI tools use transaction history to predict cash flow more accurately. They give real-time visibility across global accounts, help reduce errors, and save hours of manual forecasting work.
- Intelligent Receivables: AI automatically matches payments with invoices, even when customers combine multiple invoices in one transaction. This speeds up reconciliation, improves collection times, and makes customer interactions smoother.
Starting with AI the Right Way
For most mid-sized firms, it’s better to start small. Focus on one or two practical areas, like cash forecasting or receivables, that show clear results and return on investment. Always coordinate with the technology and compliance teams to ensure data security.
AI doesn’t replace people. It supports them, helping treasury teams anticipate risk, plan smarter, and strengthen global operations with less effort and more control.
Conclusion
Expanding into new markets is exciting but demands strong planning and control. A company’s success abroad depends on how well it manages cash, risk, and structure. Treasury teams play a big role here; they keep the business steady and help it confidently move forward.
For middle-market companies, having the right setup early makes a huge difference. A clear banking structure, strong visibility of funds, and well-defined rules for approvals help avoid confusion later.
Working with trusted local partners and understanding country-specific rules keeps operations smooth and compliant.
Technology now makes treasury work faster and easier. Automation reduces manual effort, improves accuracy, and gives teams more time for strategic thinking. AI tools go one step further.
They help forecast cash, match payments quickly, and spot risks before they become problems. Starting small with AI, like automating forecasting or receivables, can bring real benefits without a large investment.
The global market changes fast. Tariffs, currency shifts, and cost pressures are part of business today. Companies that plan early, maintain strong liquidity, and stay flexible are the ones that keep growing.
In the end, international expansion is not just about entering new markets. It’s about building smart systems that keep money flowing efficiently, no matter where business happens next.
FAQs
What industries do most middle-market companies operate in?
Middle market companies work across many industries, including manufacturing, healthcare, technology, and professional services. They often lead in specialized markets where agility and expertise matter more than size.
How do middle-market companies fund international expansion?
They usually rely on a mix of internal cash reserves, bank financing, and trade credit. Some partner with local investors or use export financing programs to reduce risk.
Why is treasury management so important for middle market companies?
Treasury management ensures cash is available when and where it’s needed. It also helps control risk, improve forecasting, and support smarter business decisions.
How often should middle-market companies review their FX strategy?
At least once a quarter. Currency markets change quickly, so regular reviews help protect profits and keep pricing stable.
What’s one common mistake middle market companies make abroad?
Many overlook local regulations or tax requirements. This can delay payments, cause penalties, or even freeze accounts.
Get Your Free Ebook
"The Corporate Treasury eBook"
Level up your Corporate Treasury knowledge with our free ebook! Explore Cash Management, Corporate Finance, Financial Risk Management, and Banking Relationship Management – all in one place
You will:
- Learn more about basic (and advanced) Treasury concepts
- Get the best examples from 110+ podcast episodes & interviews
- Understand all the functions covered by Corporate Treasury
We hate spam: your email address will never be shared or sold. By signing up here, you will receive articles, videos, commercial offers, podcasts, and other tips to help you with Corporate Treasury and anything that can directly or indirectly assist you with it. See full legal notices at the bottom of the page. You can unsubscribe at any time.
