High inflation and interest rates over the last four years are making cash depreciate in value rapidly. Neil Gallacher, Co-Head of Cash Solutions at MillTech, explains why technology is the key for CFOs to protect – and optimise –their excess cash.

For too long, inflation has made holding idle cash a costly endeavour, and the cost of inaction grows every day.

Inflation in the UK has steadily remained above 2% since April 2021, well above central bank targets. The UK experienced eight months of double-digit inflation during this period, peaking at 11.1%, and has been steadily on the rise throughout 2025. The UK’s latest inflation figure of 3.2% in November 2025 continues to outpace the Bank of England’s goal of 2%.

In this climate, CFOs are missing out on yield and watching idle cash quietly lose value. This should be a wake-up call, as leaving funds sitting in low-interest accounts or relying on a single provider can be limiting and inefficient.

With a new generation of tech-enabled financial tools now within reach, it’s time for CFOs to rethink how cash is managed and put every pound to work.

The hidden cost of cash management

Many corporate treasury teams still rely on manual, outdated processes to manage their excess cash. Some leave cash in low-interest accounts and watch it lose value.

Consider a company with £100 million in idle cash. With inflation at 3.2% and a typical low-interest account yielding just 3%, the business is effectively losing around £200,000 in purchasing power each year.

That’s value quietly eroded by inflation without a single transaction taking place. Over time, and especially across multiple cash holdings or regions, the cumulative impact becomes a significant drag on financial performance.

Others invest in products such as money market funds, which are designed to help treasurers earn interest on idle cash while preserving liquidity and aligning with inflation or interest rate shifts.

Yet, how they access these products hasn’t changed in line with advances in technology. Without the infrastructure, internal resource, and relationships, these businesses are missing out on potentially significant cash returns and governance enhancements. 

Increasingly complex Know Your Customer (KYC) and onboarding requirements also mean many firms rely on one or two counterparties, creating overconcentration, limiting diversification, and may expose them to avoidable counterparty risks.

In today’s environment, where efficient cash deployment can be a meaningful driver of returns, sticking to outdated workflows and limited access undermines treasury’s ability to preserve and grow value.

The digital treasury toolkit

Making better use of idle cash starts with better tools. Advances in financial technology are giving treasury teams access to capabilities that were once reserved for larger institutions. However, large firms have seen fewer breakthroughs in tackling their most complex challenges, such as navigating fragmented market access and integrating data from multiple sources.

Innovation in technology has gone beyond trading, portfolio and operation management systems. It’s no longer about cash management but cash optimisation. AI-powered engines can scrape information from various data sources and documents, and provide intelligent recommendations, giving CFOs the ability to act faster and enhance their decision-making. This wealth of data can be used for insights to improve short-term cash forecasts, allowing CFOs to see variances early and adjust investments, borrowings, or hedges automatically.

The widespread adoption of bank APIs is also powering treasurers to make more automated decisions. Rules-based trading, for example, can remove manual work and reduce risk, providing full audit trails and built-in regulatory compliance. This helps CFOs meet internal governance standards and external reporting requirements without adding complexity. These rules can adapt dynamically to market conditions, providing more agility and control over liquidity, leaving CFOs to focus on strategy while the engine handles routine allocations.

Preservation to performance

The corporate treasurer’s role is evolving to strategic optimisation. Basic and binary tools, such as single counterparty bank sweeps, have been replaced by systems offering consolidated access to cash deposits, money market funds, tokenised assets, and T-bills – feeding directly into Treasury Management Systems (TMS), all in one interface. This enables faster, more informed decisions and reduces the friction of managing fragmented systems or relying on outdated workflows. No longer bound by slow systems and siloed information, treasury teams now have the tools to act with agility, precision, and control.

By wrapping institutional-grade solutions in a fintech model, CFOs can now access tier-one counterparty agnostic solutions, simplifying market access despite increasing KYC and onboarding regulatory enforcement. Fintechs are uniquely positioned to erase all the operational burden and deliver compliance, transparency, and performance in a single workflow.

More can still be done. Although systems have consolidated cross-product access, execution, oversight and reporting remain largely siloed. Further innovation in automation and allocation tools can remove the remaining manual processes treasurers have.

In an era where leaving cash idle is costly, finance leaders can harness this opportunity to be more agile and proactive. These tools exist to streamline investment operations, bolster compliance and control and deliver more yield with less effort. Now is the time for corporates – and other institutional investors – to make the most of them.

Increasingly, the role of treasury is evolving from transactional to strategic. By adopting smarter tools, CFOs can turn cash management into a lever for performance, optimising liquidity, reducing risk, and contributing directly to the company’s bottom line.

 

Important disclosures

MillTech is the trading name of Millennium Global Treasury Services Limited (“MGTS”), MillTechFX Americas Inc (“MTA”), Millennium Global Investments Limited (MGIL) and Millennium Global (Switzerland) GmbH (“MGS”).

MGTS is authorised and regulated by the Financial Conduct Authority (FRN 911636). The registered address is 88 Wood Street, London, United Kingdom, EC2V 7QR. MTA is registered with the National Futures Association as a Commodity Trading Advisor (NFA ID: 0545635). MGIL is authorised and regulated by the Financial Conduct Authority (FRN 171039). The registered address is 88 Wood Street, EC2V 7QR, United Kingdom. MGS is a company registered in Switzerland with company number CHE 382.000.002. Registered address: c/o Fineac Management AG, Poststrasse 30, 6300, Zug.

This document, including the information provided herein, is provided for information purposes only and does not constitute an invitation or offer to subscribe to or purchase any of the products or services mentioned.

The information contained is intended for Professional Clients only. MillTech does not target retail clients, as the products offered by MillTech are not suitable for or made available to retail clients.

The information herein is not intended to provide, and should not be relied upon for, accounting, legal or tax advice or investment recommendations. You should consult your investment, tax, legal, accounting or other advisors.

The views expressed by individuals are their own and not those of the firm. There can be no assurance that professionals currently employed by MillTech will continue to be employed by MGTS.

*Group Hedged assets as of 31 January 2025, and is a combination of USD 15.7 billion hedged assets (all strategies that include hedging, up to the maximum amount that can be hedged) managed by Millennium Global Investments Limited and USD 12.6 billion managed by MillTech. Millennium Group comprises Millennium Global Investments Limited and Millennium Global Treasury Services Limited.