Undergoing a fundamental paradigm shift in recent years, the relationship between the finance and NFP sectors is an evolution that is not about to end any time soon.
Of course, when looking through the lens of financial health, there will always be the necessary foundational questions any organisation – be it in the profit or NFP sphere – needs to answer…
- Are funds sufficiently diversified?
- Will cashflow cover the immediate and long-term expense commitments? Is risk appetite too conservative?
- Are better products and services available to help funds go further?
However, the modern banking partnership has surpassed what many still see as the traditional “financial services” view of the banking relationship, or the “money in, money out” approach. If the conversations your organisation is having around its finances embrace these themes, that’s good, but much more is available to NFPs that could help make those conversations great and result in strengthening financial sustainability further.
Benefits from technology
Technology is just one tool in building and safeguarding financial strength. While investment in new technology is often beyond the reach of many organisations, there is help for organisations via their banking partner at either no or very little cost. This can quickly help drive both operational and financial efficiencies. Examples include…
- Cashless giving and online donation platforms: these streamline administration processes, reduce opportunities for petty theft and help boost levels of giving.
- Big data intelligence: this provides benchmarking tools as well as donor and customer insights to improve engagement, help make informed decisions and better understand cashflow trends.
- Software and system integration packages: these provide transparency around cashflow and funding trends, and the integration between an organisation’s bank account(s) and its MYOB or Xero accounting packages.
The benefits speak for themselves, and these are just some of the many “value-adds” available to NFPs through today’s progressive banking relationship.
Opportunities from innovation
It is impossible to look at the financial game changers for the NFP sector without having a conversation around innovation. No longer seen as the latest “fad”, innovation is proving itself as a way of achieving more, or providing opportunities to deliver old services in new ways.
Innovation hubs are being used in ever greater numbers by NFPs and well as their employees and volunteers. Labs and design thinking methodologies, available through some Australian financial institutions, empower every level of an organisation to rethink and push the boundaries in terms of service delivery and market engagement. This in turn increases its sustainability and relevance in today’s competitive environment.
The opportunity to access and leverage assets and know-how through a modern banking partnership can be a major differentiator in an organisation’s very survival.
Progressive banking partnerships will continue to become the norm – and it is a two-way relationship. NFPs reap the benefits from the ability to access and leverage the latest technology, products, design thinking methodologies, training programs and expert consulting teams that would often be beyond their financial reach.
Meanwhile, financial institutions continue to learn valuable skills from the NFP sector, as well as achieving greater impact and involvement in delivering their social responsibility programs.
All things considered, it is an exciting future when partnerships work for all concerned.
Julienne Price, head of NFP sector, Commonwealth Bank.