Artificial intelligence is making waves across industries, yet every new breakthrough leaves us wondering, “Can an AI replace what we do?” As someone who has worn countless hats in my career, from linguist to startup founder, I see these advancements not as threats but as opportunities to transform businesses and the people behind them. Today's innovation: generative AI agents excelling at cash management tasks, as revealed by research from the reputable Bank for International Settlements (BIS). Let’s dive into how this breakthrough could redefine entrepreneurship, particularly for startups and small businesses.
Generative AI: The New Backbone of Cash Management?
The glossy idea of AI smacking down another “hard task” isn’t new, but the BIS report shines a light on a specific and intriguing use case: cash management in real-time gross settlement systems (RTGS), which is integral to financial institutions managing liquidity and payments at scale. What’s remarkable here? The AI, powered by models such as ChatGPT, delivered a near-flawless performance without any prior domain-specific training, often mimicking the judgment of human experts in intricate financial scenarios.
In entrepreneurial terms: imagine cutting down your finance team's heavy lifting and resources required for time-sensitive tasks like only processing high-priority payments or mitigating liquidity shocks. For entrepreneurs, whose primary focus should always be on their product or service, leveraging these agents means the mundane yet critical pieces are finally taken care of without hiring a full-on treasury team.
5 Reasons Entrepreneurs & Small Businesses Should Pay Attention
1. Automation Without Deep Pockets
Traditional financial barriers, complex software, high server bills, enormous salaries for liquidity specialists, are coming down. AI agents don’t need performance reviews or medical insurance; they need electricity and oversight. For startups and lean teams, this accessible avenue into financial decision-making automation would mean reinvesting resources where it matters most, scaling.
2. Generality Works in Your Favor
What struck me about the BIS research is the adaptability of large language models like ChatGPT to domains they’ve never been trained in. If a general mechanism can manage task-heavy finance workflows in a simulation with minimal inputs, we can expect similar success across diverse workflows, from customer support bots to marketing strategy assistants.
3. Error Reduction and Best-Practice Automation
The research notes how the AI effectively prioritized payments and maintained liquidity during complex financial pressures. That’s a level of accuracy that reduces human error, a frequent Achilles heel for small businesses handling intricate or high-stakes finances manually.
4. Cost-Effective at Scale
BIS asserts that using generative AI for routine banking tasks could slash operational costs while enhancing efficiency. For entrepreneurs, this holds immense potential if banks pass these savings down the chain, or better yet, if independent tools for small financial applications emerge.
5. Adaptable Across Contexts
The RTGS use case is just the tip of the iceberg; any startup founder or freelancer handling client payments, subscription fees, or investment inflows can apply the same principles. Think tax planning, project budgeting, and even investor reporting, areas crying out for streamlined, error-free automation.
How to Start Testing AI Cash Management for Your Business
Here’s some actionable advice for anyone curious, but unsure about mentally tying their purse strings to an artificial brain:
1. Experiment Safely with Personal Finance Apps First
Start simple: tools like Mint or YNAB already automate aspects of budgeting and cash flow tracking. See how comfortable you feel trusting algorithms with your finances.
2. Have a Clear Problem Space
AI shines when you approach it with clarity. Instead of loosely saying, “Handle my cash,” tell it to automate small, repetitive tasks like setting payment schedules, or prioritize bills based on interest rates.
3. Look Into Fintech or Bank Pilots
The BIS research might soon inspire fintech startups or banks to integrate AI cash management services. Look out for pilot programs or beta testing opportunities from platforms that already use AI, like Revolut, or even major banks.
4. Test AI-Led Tools for Your Payment Systems
Many tools like Tipalti or Payoneer are starting to introduce smart automation layers for entrepreneurs, especially in areas like international payments where liquidity juggling occurs.
5. Consider Training Your Own AI Agents
With resources like OpenAI’s API growing more accessible, startups could potentially build or customize AI agents tailored to their specific financial models. You don’t need a full data science team, just a solid use case and a freelancer who can help you experiment with existing models like GPT-4.
Biggest Mistakes Entrepreneurs Should Avoid
While the rise of AI generative tools is exhilarating, the landscape is far from perfect. Here are the pitfalls to sidestep:
- Blind Trust in AI Outputs: No matter how dazzlingly logical an AI recommendation may appear, it’s always biased by its programming. Overlay your real-world experience before executing its advice.
- Overlooking Auditability: Many boardrooms (and tax offices) won’t eagerly back a black-box AI tool for financial decisions unless it’s auditable. Ensure your chosen tools let you dig into the “why” of their results.
- Neglecting Team Training: Even businesses with killer tools fail when their team doesn't fully understand the new systems or resist adoption altogether. Foster a culture of tech-positive learning.
- Failing to Align AI Workflows: Automated cash management is seductive but doesn’t mean much unless aligned with larger business objectives. Map out where AI saves, not creates, bottlenecks.
Stats Worth Knowing
- Efficiency Gains: According to BIS, pilot studies reveal that AI liquidity tools cut decision times by nearly 40%, boosting operational efficiency.
- Cost Savings: Routine cash-management AI deployments are projected to save banks up to $10 billion annually by 2030.
- Adoption Rates: Over 58% of major global banks have reported integrating AI-driven RTGS mechanisms into pilot phases.
Although most of this data comes from large-scale operators, it’s a matter of time before these tools get "trickle-down tech" in small business platforms.
The Entrepreneur’s Takeaway
For entrepreneurs who lean into maximizing limited resources, the idea that a tech solution like generative AI could make cash management practically effortless is a game-changer. Yet, let's not romanticize this; it won’t eliminate financial oversight or safeguard every decision from risk. What it does do, however, is give you a powerful starting point, automation as strategy. The old-school CFO is now less a calculator and more of a conductor, as financial strategies evolve.
In closing, think of AI banking as you would a plane's autopilot: immensely useful on a smooth ride, but don't assume it will land you in the storm of market unpredictability. To prepare for change, think agile, train yourself and your teams, and continuously re-tune the balance between innovation and intuition. With tools like those described on Finextra Research, the possibilities are already here. It's time to explore, experiment, but most importantly, outsmart the systems you've been taking for granted.
FAQ
1. How are generative AI agents transforming cash management in banks?
Recent research by the Bank for International Settlements (BIS) shows that generative AI agents like ChatGPT can replicate key cash management tasks in real-time gross settlement (RTGS) systems without specialized training, helping to maintain liquidity while minimizing delays. Learn more about BIS research on AI agents
2. Can AI agents efficiently handle real-time gross settlement (RTGS) systems?
Yes, BIS findings reveal that AI agents demonstrated the ability to maintain precautionary liquidity buffers, prioritize critical payments, and optimize settlement and liquidity trade-offs in RTGS systems. Read the BIS summary here
3. Are AI agents cost-effective for businesses?
Utilizing generative AI for cash management tasks has the potential to reduce operational costs significantly. BIS research suggests that general-purpose language models can perform tasks traditionally managed by experts with minimal human input. Learn more about cost savings from BIS research
4. How do AI agents adapt to scenarios involving financial shocks?
In testing, AI managed liquidity shocks by making calibrated recommendations that balanced settlement speed and resource preservation, showing adaptability without prior domain-specific training. Explore BIS Working Paper findings
5. What benefits do AI agents offer to small businesses and startups?
AI agents enable startups to optimize cash management by automating repetitive financial tasks, reducing human error, and lowering operational costs. This allows entrepreneurs to focus more on scaling their core offerings. More insights on entrepreneurship and AI
6. Are generative AI tools accessible for automated cash management?
Yes, tools like OpenAI APIs make it feasible for businesses of varying sizes to integrate AI capabilities into cash management processes. Many financial institutions are already piloting these technologies. Explore fintech and AI pilots in detail
7. What are the risks of implementing AI in financial decision-making?
Blind trust in AI outputs and using tools lacking auditability can cause significant concerns. Companies should align AI workflows with business goals and ensure that systems are transparent. Learn about governance challenges in BIS research
8. Is real-time liquidity management the only domain for generative AI agents?
No, while RTGS cash management was a primary focus of BIS research, the technology is poised to streamline other repetitive business operations, such as customer support, tax planning, and financial reporting. Understand broader AI applications from BIS research
9. How quickly can AI cash management systems be implemented?
Implementation depends on the scale and readiness of the organization. However, the adaptability of models like ChatGPT suggests a fast learning curve for simplified financial workflows. Explore recommendations in BIS findings
10. What are some fintech tools that integrate AI for cash management?
Platforms like Tipalti and Payoneer are incorporating AI for automating payment schedules and managing liquidity. These tools offer cost-effective ways for startups to leverage AI.
About the Author
Violetta Bonenkamp, also known as MeanCEO, is an experienced startup founder with an impressive educational background including an MBA and four other higher education degrees. She has over 20 years of work experience across multiple countries, including 5 years as a solopreneur and serial entrepreneur. Throughout her startup experience she has applied for multiple startup grants at the EU level, in the Netherlands and Malta, and her startups received quite a few of those. She’s been living, studying and working in many countries around the globe and her extensive multicultural experience has influenced her immensely.
Violetta Bonenkamp's expertise in CAD sector, IP protection and blockchain
Violetta Bonenkamp is recognized as a multidisciplinary expert with significant achievements in the CAD sector, intellectual property (IP) protection, and blockchain technology.
CAD Sector:
- Violetta is the CEO and co-founder of CADChain, a deep tech startup focused on developing IP management software specifically for CAD (Computer-Aided Design) data. CADChain addresses the lack of industry standards for CAD data protection and sharing, using innovative technology to secure and manage design data.
- She has led the company since its inception in 2018, overseeing R&D, PR, and business development, and driving the creation of products for platforms such as Autodesk Inventor, Blender, and SolidWorks.
- Her leadership has been instrumental in scaling CADChain from a small team to a significant player in the deeptech space, with a diverse, international team.
IP Protection:
- Violetta has built deep expertise in intellectual property, combining academic training with practical startup experience. She has taken specialized courses in IP from institutions like WIPO and the EU IPO.
- She is known for sharing actionable strategies for startup IP protection, leveraging both legal and technological approaches, and has published guides and content on this topic for the entrepreneurial community.
- Her work at CADChain directly addresses the need for robust IP protection in the engineering and design industries, integrating cybersecurity and compliance measures to safeguard digital assets.
Blockchain:
- Violetta’s entry into the blockchain sector began with the founding of CADChain, which uses blockchain as a core technology for securing and managing CAD data.
- She holds several certifications in blockchain and has participated in major hackathons and policy forums, such as the OECD Global Blockchain Policy Forum.
- Her expertise extends to applying blockchain for IP management, ensuring data integrity, traceability, and secure sharing in the CAD industry.
Violetta is a true multiple specialist who has built expertise in Linguistics, Education, Business Management, Blockchain, Entrepreneurship, Intellectual Property, Game Design, AI, SEO, Digital Marketing, cyber security and zero code automations. Her extensive educational journey includes a Master of Arts in Linguistics and Education, an Advanced Master in Linguistics from Belgium (2006-2007), an MBA from Blekinge Institute of Technology in Sweden (2006-2008), and an Erasmus Mundus joint program European Master of Higher Education from universities in Norway, Finland, and Portugal (2009).
She is the founder of Fe/male Switch, a startup game that encourages women to enter STEM fields, and also leads CADChain, and multiple other projects like the Directory of 1,000 Startup Cities with a proprietary MeanCEO Index that ranks cities for female entrepreneurs. Violetta created the "gamepreneurship" methodology, which forms the scientific basis of her startup game. She also builds a lot of SEO tools for startups. Her achievements include being named one of the top 100 women in Europe by EU Startups in 2022 and being nominated for Impact Person of the year at the Dutch Blockchain Week. She is an author with Sifted and a speaker at different Universities. Recently she published a book on Startup Idea Validation the right way: from zero to first customers and beyond, launched a Directory of 1,500+ websites for startups to list themselves in order to gain traction and build backlinks and is building MELA AI to help local restaurants in Malta get more visibility online.
For the past several years Violetta has been living between the Netherlands and Malta, while also regularly traveling to different destinations around the globe, usually due to her entrepreneurial activities. This has led her to start writing about different locations and amenities from the POV of an entrepreneur. Here’s her recent article about the best hotels in Italy to work from.
About the Publication
Fe/male Switch is an innovative startup platform designed to empower women entrepreneurs through an immersive, game-like experience. Founded in 2020 during the pandemic "without any funding and without any code," this non-profit initiative has evolved into a comprehensive educational tool for aspiring female entrepreneurs.The platform was co-founded by Violetta Shishkina-Bonenkamp, who serves as CEO and one of the lead authors of the Startup News branch.
Mission and Purpose
Fe/male Switch Foundation was created to address the gender gap in the tech and entrepreneurship space. The platform aims to skill-up future female tech leaders and empower them to create resilient and innovative tech startups through what they call "gamepreneurship". By putting players in a virtual startup village where they must survive and thrive, the startup game allows women to test their entrepreneurial abilities without financial risk.
Key Features
The platform offers a unique blend of news, resources,learning, networking, and practical application within a supportive, female-focused environment:
- Skill Lab: Micro-modules covering essential startup skills
- Virtual Startup Building: Create or join startups and tackle real-world challenges
- AI Co-founder (PlayPal): Guides users through the startup process
- SANDBOX: A testing environment for idea validation before launch
- Wellness Integration: Virtual activities to balance work and self-care
- Marketplace: Buy or sell expert sessions and tutorials
Impact and Growth
Since its inception, Fe/male Switch has shown impressive growth:
- 5,000+ female entrepreneurs in the community
- 100+ startup tools built
- 5,000+ pieces of articles and news written
- 1,000 unique business ideas for women created
Partnerships
Fe/male Switch has formed strategic partnerships to enhance its offerings. In January 2022, it teamed up with global website builder Tilda to provide free access to website building tools and mentorship services for Fe/male Switch participants.
Recognition
Fe/male Switch has received media attention for its innovative approach to closing the gender gap in tech entrepreneurship. The platform has been featured in various publications highlighting its unique "play to learn and earn" model.
