Corporate treasury under inflation: what alternatives to bank accounts?

For several years, companies have faced a major challenge: inflation erodes the value of their treasury. By leaving cash in low-yield bank accounts, they lose purchasing power month after month.

While banks offer very limited deposit rates for most SMEs and mid-sized firms, alternatives are emerging to protect and grow corporate liquidity. Money market funds, bonds, fintech platforms, even stablecoins: the range of options is expanding.

The limits of traditional bank accounts

Current accounts and standard savings remain the default for storing cash. But today, they show several weaknesses:

• Near-zero yield: few banks offer more than 1% on corporate deposits.
• High inflation: with inflation ranging from 3% to 5%, cash loses value every year.
• Lack of flexibility: funds are stored but not actively managed for return.

This situation pushes more and more SMEs and scale-ups to explore alternatives.

Traditional financial solutions: funds and bonds

To counter value loss, finance teams are turning to tried-and-tested tools:

• Money market funds: investing in short-term instruments like Treasury bills or deposits. They generally yield more than bank accounts, with strong liquidity.
• Government or corporate bonds: placing part of the treasury over 1–5 years, with yields exceeding 3% in many cases.
• Term deposits: some banks still offer time deposits blocked for a few months with higher yields.

These instruments remain relatively safe but require more active management and planning.

New alternatives: fintechs and digital assets

Beyond traditional finance, a wave of innovation is offering new opportunities:

• Treasury management fintechs: platforms that automatically allocate cash across different instruments to optimize yield.
• Yield-bearing stablecoins: pegged to the euro or dollar, they can generate 5–7% annually via secured savings pools. For companies, this means diversifying liquidity while retaining high availability.
• Simplified staking: although more suited to advanced investors, it is emerging as a way to generate passive income on certain cryptos.

These alternatives help capture yield without fully compromising on safety and liquidity. They still require careful analysis and regulatory clarity.

Conclusion

In an inflationary environment, leaving cash idle in a bank account means losing money. Companies must now consider alternatives: money market funds, bonds, fintech tools, and even digital assets like stablecoins.

The goal is not only yield, but also capital preservation and financial security. It’s a strategic reflection every finance team should start today.

Frequently asked 🤔

How does inflation impact a company’s treasury?

Inflation reduces the purchasing power of cash. A company holding €1M in a non-interest-bearing account loses tens of thousands of euros in real value each year.

Do bank accounts still provide sufficient protection?

Not really. Banks typically offer under 1% on treasury deposits. It’s useful for security and daily operations, but insufficient against inflation.

What simple alternatives are available to SMEs?

Money market funds and term deposits are the most accessible. They provide better yield while keeping liquidity. Some fintechs also offer automated treasury management.

Are stablecoins a viable option for companies?

Yes, provided they use reliable and compliant platforms. Stablecoins can generate attractive yields (5–7%), but require proper risk assessment and regulatory framing.

How should a company choose the right treasury strategy?

It’s about balancing three criteria: safety, liquidity, and yield. The best approach often combines traditional banking, money market funds, and diversification into new alternatives like fintech platforms or stablecoins.