Treasury management is how a business makes sure it always has the cash it needs, controls the risks around that cash and earns a return on money it does not need yet. Large companies run a full treasury function for this. The same discipline works for any business with €50,000 or more sitting in the bank.
Most smaller businesses have no treasury team, so surplus cash stays in a current account. In August 2026, euro area companies earned an average of 0.61% on overnight deposits, according to the ECB, while the ECB paid banks 2.25% on theirs. The EU deposit guarantee also stops at €100,000 per bank, so a larger balance is only partly covered.
This is where we come in. We connect your business with our regulated treasury partner, so idle cash can go into money market funds, Treasury bills and government bonds. We check eligibility and handle the setup. Onboarding is digital, the money is invested in 2 to 3 business days and there is no lock-in.
Treasury Management Without a Treasury Team
You do not need a treasurer to put idle business cash to work. This is what we set up for you.
- Regulated partner: A CySEC-regulated investment firm handles the investing.
- Earn on idle cash: Money market funds from 2% p.a., Treasury bills from 2.5% p.a.
- Less bank concentration: Hold government debt instead of one large bank balance.
- No lock-in: Sell when the business needs the cash, with no notice period.
- Fast setup: Digital onboarding, cash invested in 2 to 3 business days.
- One point of contact: We handle the setup, so there is no back-and-forth.
When investing, your capital is at risk. Yields may vary.
Sophic
Treasury management
Yield
2% to 3%+ p.a
Fees
0.3% a year + €10 per order
Eligibility
EU/EEA businesses with an LEI
When investing, your capital is at risk. Yields may vary.
What Is Treasury Management
Treasury management is the work of managing a business's cash, funding and financial risk. Its first job is to make sure bills, salaries and suppliers can always be paid. Its second job is to make the rest of the cash work: invested sensibly, protected from avoidable risk, and ready when the business needs it.
The Association of Corporate Treasurers (ACT), the UK professional body for treasurers, says treasury "involves the management of money and financial risks in a business." Its priority, in the ACT's words, is to ensure the business has the money it needs for its day-to-day obligations, while also helping develop its long-term financial strategy and policies.
Treasury Management Meaning in Plain Terms
In plain terms, treasury management answers three questions. How much cash do we have, and where is it? How much will we need over the next weeks and months? What should happen to the rest? A business that can answer all three quickly has working treasury management, whether or not anyone has treasurer in their job title.
If you need to define treasury management in one sentence for a board paper, use this: it is the management of the company's liquidity, funding and financial risk. Cash management is the daily part of that work, collecting, paying and positioning cash. Treasury management is wider, because it also sets funding, risk and investment policy. We go through how cash management and treasury differ in a separate guide.
Where Treasury Sits in the Finance Team
Accounting records what already happened. The treasury function looks forward and deals with the cash that exists today and the cash that is coming. In a large group, a dedicated treasury function reports to the CFO and runs bank relationships, funding and hedging. In a business with 10 to 200 staff, the same treasury management work usually sits with the CFO, the finance director or the owner, next to the monthly close and the payroll.
The tools change with size. Large companies run treasury operations on software connected to dozens of bank accounts. A smaller business can cover most treasury management needs with a cash forecast in a spreadsheet, a clear rule for how much to keep in the bank, and a place to invest the surplus.
Banks Do Not Pass Rate Rises On in Full
Treasury management decisions matter most when interest rates change. The ECB raised its three key rates by 0.25 percentage points in June 2026 and again in September 2026, taking the deposit facility rate to 2.50% from 16 September. Its next monetary policy meeting ends on 29 October 2026.
Banks do not pass those increases on to current accounts in full. The ECB's own statistics show the average rate on companies' overnight deposits stayed at 0.61% in August 2026. On deposits fixed for up to one year it was 2.24%, but only if the money is locked away. The gap between what short-term markets pay and what a current account pays is the cost of having no treasury management at all.
Sophic
Treasury management
Yield
2% to 3%+ p.a
Fees
0.3% a year + €10 per order
Eligibility
EU/EEA businesses with an LEI
When investing, your capital is at risk. Yields may vary.
What the Treasury Function Does
The treasury function makes sure the business can always pay, funds it at a sensible cost, manages the financial risks around its cash and invests what is not needed. In a large group that is a full treasury department. In a smaller business it is a set of treasury management tasks that someone in finance owns.
Cash Visibility and Forecasting
Treasury management starts with knowing the cash position: every account, every currency, every day. The treasury function then forecasts what comes in and what goes out. A common approach is a rolling 13-week forecast, updated weekly. That forecast is the core of good cash flow management, and it decides how much cash is truly spare.
Liquidity and Working Capital
Liquidity means having enough cash, or assets that turn into cash quickly, to meet payments as they fall due. The treasury function sets a buffer, decides which accounts hold it, and makes sure money is in the right entity and currency on the right day. Our guide to liquidity management for businesses covers how to size that buffer.
The treasury function also works with the wider finance team on working capital: how fast customers pay, how long the business takes to pay suppliers, and how much stock it holds. Each of those decides how much cash the business ties up just to keep trading.
Funding and Bank Relationships
The treasury team arranges the credit lines, overdrafts and loans the business may need, and keeps its banks informed. The treasury team also decides how many banks to use. Holding everything at one bank is simpler, but it puts all the cash on one balance sheet.
Financial Risk Management
Treasury management covers the risks that come with money: currency movements, interest rate changes, and the chance that a bank or a counterparty fails. For international groups, currency is usually the biggest of these. In PwC's 2025 Global Treasury Survey of 350 treasurers, 83% named FX risk as their most critical economic exposure. Hedging and limits are covered in our guide to treasury risk management.
Investing Surplus Cash
Once the buffer is set, the treasury function makes the rest of the cash earn something. This is the job smaller businesses skip most often, while larger ones have been moving money out of bank deposits. The 2026 AFP Liquidity Survey of 309 US treasury professionals found that the average share of short-term investments held in bank deposits fell to 42%, the lowest since 2011.
Policy, Controls and Reporting
The treasury department also writes the rules: who can move money, which instruments are allowed, the maximum held with any one bank or fund, and how results are reported to the board. In a small company this can be a two-page treasury policy. It is still worth writing, because it turns one person's habits into a decision the board has approved.
Outsource the Investing Side of the Treasury Function
Most finance teams already have the forecast. What they lack is a simple way to invest the surplus without building treasury operations. We set that up with you.
- No treasurer needed: You choose the amounts, our partner runs the investing.
- Short-dated government debt: Treasury bills from the EU, Germany, France and more.
- Three currencies: Money market funds in EUR, GBP and USD.
- Segregated client cash: Held at J.P. Morgan, apart from the firm's own money.
- Independent custody: Your investments are safeguarded by SIX Group.
- Live in days: Onboarding takes about a day once your documents are in.
When investing, your capital is at risk. Yields may vary.
The Essentials of Treasury Management
The essentials of treasury management come down to six habits. A company treasury of any size can adopt all of them without new software or new hires.
Know Your Cash Position Every Day
Pull every balance into one view: bank accounts, payment and EMI accounts, card float and money held by payment processors. Many businesses find cash they had forgotten in an old account or a payment provider. One view also shows how much is sitting idle, the first number good treasury management looks at.
Forecast 13 Weeks Ahead
A rolling 13-week forecast is detailed enough to plan payroll, VAT and supplier runs, and short enough to stay accurate. Update it weekly against what actually happened. When the forecast and the bank balance disagree, find out why before you move any money.
Split Cash Into Three Buckets
Operating cash covers the next one to two months of payments and stays in the current account. Reserve cash covers shocks, such as a large customer paying late, and needs to be reachable within days. Strategic cash is set aside for a known future use, such as a tax bill, an acquisition or a building, and can be invested to match that date. Our guide on how much cash reserves a business should have helps size the middle bucket.
Cap How Much Sits in One Bank
Concentration is the risk most businesses only notice when it is too late. When Silicon Valley Bank failed in March 2023, Roku disclosed in a filing that about $487 million, roughly 26% of its cash, was held there. A simple rule in the treasury policy, such as a maximum balance per bank, stops one failure from hitting the whole business.
Match Investments to When You Need the Cash
Money you need in three months should not sit in a 10-year bond, because its price can fall if you have to sell early. Money market funds and short Treasury bills suit reserve cash. Longer bills and government bonds suit strategic cash with a fixed date further out.
Write a Short Treasury Policy
Put the rules in a short treasury policy: the buffer, the buckets, the allowed instruments, the limits per bank and fund, and who approves a move. Review it once a year, or sooner when rates or the business change.
Read more: what idle cash is and what it costs a business.
Sophic
Treasury management
Yield
2% to 3%+ p.a
Fees
0.3% a year + €10 per order
Eligibility
EU/EEA businesses with an LEI
When investing, your capital is at risk. Yields may vary.
Treasury Management for Smaller Businesses
So what is treasury management for a business with no treasurer? It is a forecast, a buffer, a limit per bank and a sensible home for the cash above that. For a business holding €50,000 or more that it will not touch for months, that last step is where most of the value sits.
What Idle Cash Costs a Business
Take a business with €500,000 above its operating buffer. At the euro area average of 0.61% on corporate overnight deposits, it earns about €3,050 a year. In a money market fund at the 2% p.a. starting yield our partner offers, the same money would earn about €10,000 before fees, or around €8,480 after a 0.3% yearly fee and two small order charges. When investing, your capital is at risk. Yields may vary.
If rates stayed where they are, that gap would add up to more than €16,000 over three years on a single balance. Most of the money also sits above the deposit guarantee limit while it waits.
Deposits Above €100,000 Are Not Fully Protected
Under Article 6 of the EU Deposit Guarantee Schemes Directive 2014/49/EU, deposits are covered up to €100,000 per depositor. Article 7 applies that limit to all your accounts at the same bank added together, whatever the currency. Non-financial companies qualify as depositors, and payouts are due within seven working days. Anything above €100,000 at one bank is outside the scheme, and getting it back depends on how the bank is resolved or wound up.
Moving surplus cash into Treasury bills or money market funds is a treasury management decision, and it changes what you hold. Those are investments, not deposits, so the guarantee does not apply to them either. Their value depends on the issuing government or the fund's holdings rather than on one bank's balance sheet. The rules are set out in our guide to deposit guarantee schemes for business accounts.
Businesses That Hold the Most Idle Cash
Any business where money arrives well before it is spent. The pattern is the same across very different sectors, and the table shows how the cash builds up and roughly when it goes out again.
Business | Why cash builds up | When it is needed |
|---|---|---|
Premiums come in before claims are paid, and reserves are held against future claims | Over months or years, as claims are settled | |
Fees are collected a term or a year in advance | Month by month, as salaries and running costs fall due | |
Grants and large donations arrive in lumps, and most boards keep a reserve | Through the year, plus a reserve held for shocks | |
A funding round is paid in at once | Over the next year or two, as the team and product grow | |
Customers pay annual plans upfront | Month by month, as the service is delivered | |
Cash piles up after peak seasons | Before the next big stock order | |
Profits and tax money build up before distributions | On distribution and tax dates (client money follows its own rules) | |
Holding companies after a sale | Sale proceeds wait for the next investment or a payout | When the next deal or dividend is agreed |
Any profitable company | Corporate tax builds up during the year | On the tax payment date, often months after the year end |
In every row, cash arrives before it is spent, and the business can usually say roughly when it will go out. In treasury management, that timing decides where the money can sit in the meantime. A balance that waits six months for a tax bill has no reason to earn 0.61%.
When a Business Needs Its Own Treasury Function
A dedicated treasury function makes sense once a business runs several entities, banks in many countries, borrows heavily or carries large currency exposure. Below that, the finance lead can cover treasury management in a few hours a week, with a regulated partner handling the investing. For groups past that point, read our guide to treasury in a large group.
Sophic
Treasury management
Yield
2% to 3%+ p.a
Fees
0.3% a year + €10 per order
Eligibility
EU/EEA businesses with an LEI
When investing, your capital is at risk. Yields may vary.
Where a Business Can Put Surplus Cash
The main options are a business savings or notice account, a money market fund, Treasury bills and government bonds. They differ in return, how fast you get the cash back, and what protects it. Only the bank account is covered by the deposit guarantee. The other three are investments.
Business Savings and Notice Accounts
A business savings account is the simplest step up from a current account, but rates stay low unless you lock the money away. PTSB in Ireland, for example, published business rates of 0.75% on demand deposits, 1.75% on a 32-day notice account and 2.25% on a 12-month fixed deposit, effective 7 July 2026.
Money Market Funds
A money market fund pools investors' cash into very short-term, high-quality instruments such as government bills, commercial paper and bank deposits. In the EU these funds follow the Money Market Funds Regulation (EU) 2017/1131, which has applied since 21 July 2018. It sets three types: public debt constant net asset value (CNAV), low volatility net asset value (LVNAV) and variable net asset value (VNAV) funds. Public debt CNAV and LVNAV funds must hold at least 10% of assets maturing daily and 30% weekly.
The regulation also stops a sponsor from propping up a fund's value (Article 35), and the fund's marketing must make clear that the investment carries no guarantee. With our partner, money market funds start from 2% p.a. in EUR, GBP and USD. When investing, your capital is at risk. Yields may vary.
Treasury Bills
Treasury bills are short-term government debt, usually 3 to 12 months. You buy below face value and get the full amount back at maturity, and the difference is your return. At the time of writing, in October 2026, Germany's auction on 5 October sold bills maturing in January 2027 at an average yield of 2.586%, and France sold 52-week bills at 3.262% the same day. With our partner, Treasury bills start from 2.5% p.a. When investing, your capital is at risk. Yields may vary.
Government Bonds
Government bonds pay a fixed interest coupon, usually once a year in the euro area, and repay the face value at maturity. They usually pay more than bills because the money is tied up for longer. The 10-year German Bund yielded about 3.47% on 5 October 2026, based on Bundesbank data.
The catch is price risk. If rates rise after you buy, the bond's market price falls, and selling before maturity can mean a loss. With our partner, European government bonds and others start from 3% p.a. When investing, your capital is at risk. Yields may vary.
Savings Accounts, Funds, Bills and Bonds Compared
This is how the four options compare on the points a treasury manager usually weighs first.
Factor | Business savings account | Money market fund | Treasury bills | Government bonds |
|---|---|---|---|---|
Typical return | 0.61% euro area average on corporate overnight deposits (ECB, August 2026); 2.24% on deposits fixed up to 1 year | From 2% p.a. with our partner, variable | From 2.5% p.a. with our partner, fixed to maturity | From 3% p.a. with our partner, fixed coupon |
Access to cash | Same day on demand accounts; notice or term on others | Sell when you need the cash | Repaid at maturity or sold earlier at market price | Repaid at maturity or sold earlier at market price |
Lock-in | None on demand accounts; notice or term on higher rates | None with our partner | None with our partner | None with our partner |
Deposit guarantee cover | Up to €100,000 per bank | None, not a deposit | None, not a deposit | None, not a deposit |
Main risk | Bank failure above €100,000, low return | Value of the fund's holdings can fall | Issuing government's credit, price moves if sold early | Price falls when rates rise, more on longer bonds |
The table shows the real trade-off. A bank account wins on same-day access and the €100,000 cover. The three investments pay more and do not depend on one bank's balance sheet, but they are not deposits and their value can move. Many businesses use both: operating cash in the bank, reserve cash in a money market fund or short bills, and strategic cash in bills or bonds timed to when it is needed. When investing, your capital is at risk. Yields may vary.
You Need an LEI Before You Can Invest
Before an EU investment firm can buy Treasury bills or government bonds for a company, it needs the company's Legal Entity Identifier. Article 13(2) of Commission Delegated Regulation (EU) 2017/590 has required this since 3 January 2018, and the market calls it "no LEI, no trade". A bank savings account does not need one, so it is easy to miss until the first investment.
GLEIF describes the LEI as "a unique 20-character alphanumeric code" that identifies a legal entity, based on the ISO 17442 standard, and counted more than 3.1 million active LEIs in the second quarter of 2026. It is renewed every year with the issuer. Our guides explain what an LEI number is and how to get an LEI number.
Read more: money market fund vs savings account and Treasury bills vs bonds.
Treasury Management for Surplus Business Cash
Put each bucket of cash where it fits, without opening accounts at three different institutions.
- Money market funds: From 2% p.a., variable, in EUR, GBP or USD.
- Treasury bills: From 2.5% p.a., fixed until maturity.
- Government bonds: From 3% p.a., with regular interest payments.
- Matched to your forecast: Pick maturities that line up with when you need the cash.
- Sell when you need it: No lock-in period on any instrument.
- Fees shown upfront: A small yearly fee and a flat charge per order.
When investing, your capital is at risk. Yields may vary.
What It Costs to Invest Business Cash
Investing business cash usually costs a small yearly fee on the amount invested, plus a flat charge or a price spread each time you buy or sell. The fair comparison is with what a current account pays, not with zero, because idle cash has a cost too.
Costs to Check Before You Invest
Most providers charge some mix of the costs below. Ask for all of them in writing before you invest.
Cost | How it is charged | What to check |
|---|---|---|
Service or platform fee | A percentage a year of the invested balance | Whether custody and reporting are included |
Fund charges | Built into a money market fund's price as ongoing charges | The fund's published ongoing charges figure |
Order or dealing fee | A flat amount for each buy or sell | How often you expect to trade |
Price spread | The gap between the buying and selling price of a bill or bond | Whether it is shown before you trade |
Custody | Sometimes separate, often inside the service fee | Who holds the assets and what it costs |
Currency conversion | A margin on the exchange rate | Only applies if you invest outside your base currency |
LEI | Paid to an LEI issuer and renewed every year | The renewal date, so it never lapses |
The yearly fee and the fund charges matter most on a balance you leave invested. Dealing fees and spreads matter more if you move money often. A business that buys and holds to maturity pays very little in trading costs.
What Fees Do to Your Return
Say a business puts €250,000 into Treasury bills yielding 2.5% and pays total costs of 0.3% a year plus two small order fees. The return before costs is €6,250, costs take about €770, and around €5,480 is left. The same money at the euro area average of 0.61% on overnight deposits earns about €1,525. When investing, your capital is at risk. Yields may vary.
In treasury management, fees are worth comparing, but they rarely decide the outcome on their own. The bigger lever is moving cash that has no job in the next few months out of an account that pays close to nothing. Our partner's fees are on its listing card, so you can run this sum with real numbers before you invest.
Read more: how our treasury service for businesses works.
Sophic
Treasury management
Yield
2% to 3%+ p.a
Fees
0.3% a year + €10 per order
Eligibility
EU/EEA businesses with an LEI
When investing, your capital is at risk. Yields may vary.
Common Treasury Mistakes in Smaller Businesses
Most treasury management mistakes in smaller companies are not dramatic. They are habits that quietly cost return or add risk year after year.
Leaving Everything in the Current Account
It feels prudent, but it costs the gap between 0.61% and what short-dated government debt pays, every year. It also puts all the cash on one bank's balance sheet, most of it above the €100,000 cover.
Investing Without a Forecast
Cash moved without a forecast tends to come back at the wrong time. Next quarter's VAT should not sit in a long bond. Build the forecast first, then let the treasury function decide what is truly spare.
Chasing the Highest Yield
A higher yield usually means a longer maturity or more credit risk. For reserve cash, a sound treasury policy puts access and the quality of the issuer ahead of the last few tenths of a percent.
Forgetting the LEI Renewal
An LEI has to be renewed every year. Put the renewal date next to the annual return and the tax deadlines, so it never holds up an investment.
Treasury Management Help for Smaller Businesses
Most EU and EEA businesses with idle cash can start quickly. We check the details with you first.
- Above €100,000 in one bank: Move the surplus off a single bank's balance sheet.
- No LEI yet: We tell you what is needed before onboarding starts.
- Documents listed upfront: One clear list, no rounds of requests.
- Sector checked early: Excluded industries are flagged in the first call.
- Invested in days: Funds go to work 2 to 3 business days after onboarding.
When investing, your capital is at risk. Yields may vary.
Bottom Line
Treasury management is not only for large groups. The treasury function's core jobs, knowing your cash, forecasting it, controlling risk and investing the surplus, apply to any business with money in the bank. For a smaller company, the essentials of treasury management are a forecast, three buckets and a limit per bank. The rest of treasury management is moving idle cash from an account paying 0.61% on average to instruments that pay closer to market rates, within limits the board has agreed.
What is treasury management in simple terms?
What does the treasury function do in a company?
What are the essentials of treasury management?
What is the difference between treasury management and accounting?
Does a small business need a treasury function?
How much cash should a business keep in its current account?
Are business bank deposits protected above €100,000?
What can a company invest its idle cash in?
Is a money market fund the same as a bank deposit?
Why do I need an LEI to invest company cash?
How long does it take to start investing business cash?
How much does it cost to invest business cash?
Who runs the treasury function in a small company?
Sources
- European Central Bank, Key ECB interest rates (checked 6 October 2026)
- European Central Bank, Monetary policy decisions, 10 September 2026
- European Central Bank, Euro area bank interest rate statistics, August 2026 (released 1 October 2026)
- Directive 2014/49/EU on deposit guarantee schemes, EUR-Lex
- Regulation (EU) 2017/1131 on money market funds, EUR-Lex
- Commission Delegated Regulation (EU) 2017/590 (RTS 22), EUR-Lex
- GLEIF, Introducing the Legal Entity Identifier
- GLEIF, The LEI in numbers, Q2 2026
- Deutsche Bundesbank, Bubill auction results, 5 October 2026
- Agence France Trésor, Latest auctions
- Association of Corporate Treasurers, What is treasury
- PwC, 2025 Global Treasury Survey
- AFP, 2026 Liquidity Survey press release
- Roku, Form 8-K filed 10 March 2023, SEC
- PTSB, Business deposit rates effective 7 July 2026
- KDPW, LEI fees
Disclaimer
Binderr does not provide investment services or investment advice. We introduce businesses to our regulated treasury partner and help with the setup. Investment services are provided by Athlos Capital Investment Services Ltd, which is regulated by the Cyprus Securities and Exchange Commission (CySEC, licence 348/17). Client cash is held in segregated accounts at J.P. Morgan, and investment assets are safeguarded by SIX Group.
Every investment is made under the partner's own terms and conditions, fees and risk disclosures, which you review and accept directly with the partner before you invest. The decision to invest is yours. Binderr is not responsible for investment performance, for any loss, or for the services the partner provides.
This article is general information, not investment, tax or legal advice. Figures, rates and rules were checked against the sources listed at the time of writing and can change. When investing, your capital is at risk. Yields may vary.
