A manufacturing company with £15 million of annual turnover operating across three currencies will typically manage its treasury in a combination of spreadsheets, manually exported bank statements, and a relationship manager at its clearing bank who handles FX transactions by phone. This is not an edge case — it describes the treasury function of the vast majority of mid-market UK businesses. The tools that large corporates use for cash visibility, FX hedging, and liquidity management — treasury management systems from vendors like Kyriba or ION — carry licensing costs and implementation requirements that make them inaccessible below a turnover threshold of roughly £50 million. The gap between "Excel and a bank relationship" and "proper treasury infrastructure" has been a persistent feature of the UK business market for two decades.
The conditions for closing this gap are new. Real-time payments infrastructure — specifically Faster Payments and the increasingly reliable Open Banking connectivity layer above it — means that a mid-market treasury product can pull live bank balances across multiple accounts and currencies without waiting for end-of-day batch files or requiring manual export. The multi-banking connectivity problem that was expensive to solve in 2015 is now substantially more tractable via Open Banking APIs. Combine this with cloud-native FX APIs that provide live rate feeds and automated hedging execution, and the basic technical stack for a mid-market treasury product is available at a cost that supports a SaaS pricing model the segment can afford.
The commercial challenge remains the FX component. Mid-market businesses are systematically overcharged for FX by their clearing banks — the spread on a manual bank FX transaction for a business in the £5M–£50M turnover range can be materially worse than the institutional rate, and the bank relationship manager has no particular incentive to proactively offer better pricing. Companies like Verto, which we backed at Series A in 2023, are addressing this with multi-currency treasury infrastructure specifically designed for SMEs and mid-market businesses — providing live FX rates, automated payment execution across currencies, and the reconciliation tooling to close the loop. The spread compression available to these customers simply by moving from manual bank FX to a purpose-built treasury product represents meaningful cash value annually, which makes the value proposition unusually easy to articulate.
The AI component of this thesis is at an earlier stage of maturity than the payments infrastructure piece. Cash flow forecasting for mid-market businesses is a genuine machine learning problem — predicting when receivables will actually be paid, accounting for seasonal patterns in payables, and incorporating external signals like counterparty payment behaviour — and the training data needed to build a reliable model requires a critical mass of customer relationships. This means the AI-driven forecasting feature is a later addition to what starts as a connectivity and execution product. We are cautious about companies that lead with the AI forecasting story before they have the banking connectivity working reliably — the infrastructure foundation has to come first, and the intelligence layer builds on top of it.
The market structure we expect to see over the next three to five years is a consolidation of multi-currency payment execution and treasury management into a small number of platforms specifically designed for the £1M–£50M turnover segment. The clearing banks will not meaningfully address this segment with purpose-built tools — their cost structure and legacy systems make it uneconomic. The neobanks that focus on this market will face competition from infrastructure-native competitors who started with the payments and FX problem rather than the deposit and lending relationship. The businesses that win here will combine reliable multi-bank connectivity, competitive FX execution, and — eventually — AI-driven working capital forecasting that makes the product genuinely indispensable to its customers' day-to-day financial management.