In today’s dynamic financial environment, securing optimal financing terms and maintaining strong relationships across the funding ecosystem can prove challenging. Credit strength is very important, but so too are factors such as operational integrity. One
of the most critical yet underutilised levers in achieving this is Authorised Signatory Management (ASM).
ASM governs who can legally commit an organisation to financial transactions. When managed well, it becomes a strategic asset that enhances lender confidence, reduces fraud risk, and improves financing efficiency. For organisations with strong ASM frameworks
and governance in place, they can benefit from better financing terms over time and stronger partner confidence across their funding ecosystem.
Why ASM matters in financing
ASM plays a pivotal role in shaping how financial institutions assess and engage with their clients:
- Enhanced lender confidence: A well-governed ASM framework signals strong internal controls, reducing the perceived counterparty risk. This is particularly vital in trade finance and invoice discounting, where trust in the legitimacy of
signatories directly impacts credit decisions. - Fraud risk reduction: Weak ASM structures and controls are a known vulnerability in trade and invoice financing. Fraudulent signatory activity can lead to financial losses and reputational damage. Strong ASM helps prevent unauthorised transactions
and supports KYC / KYB and AML alignment, simplifying due diligence for financial institutions. There is also a clear cost for organisations, as weak internal controls often translate into higher interest or discount rates to offset higher operational risk. - Optimised working capital: Corporates with clear, digital ASM systems can accelerate transaction approvals (from days to minutes), reducing time to cash and improving liquidity. This efficiency can translate into better financing terms
over time. - Governance assurance: ASM provides a tangible measure of governance maturity. A robust ASM system ensures audit trails, real-time updates, and clear authority limits, which are essential for corporate governance and regulatory compliance.
For financial institutions, this assurance strengthens credit confidence. For organisations, this can lead to more favourable pricing and faster onboarding.
Whilst most discussions on this topic focus on large organisations, ASM is also a relevant and scalable solution for SMEs; and one that will help provide access to finance faster and securely.
From a broader industry perspective, ASM is increasingly recognised as a key enabler of digital transformation across supply chain finance, invoice financing, and trade finance. Despite accelerated digitalisation efforts following the COVID pandemic, authorised
signatory lists remain a pain point for financial institutions. Digital ASM solutions have a pivotal role to play here as they provide a single source of truth. This enables instant verification which is particularly important for financing agreements where
speed of approval and payment are key.
Making ASM work and drive real impact
To unlock the full value of ASM in financing, financial institutions and organisations should both consider the following actions:
1. Digitise ASM frameworks
This is the catalyst for unlocking wider value. Move away from manual, paper-based signatory records. Implement secure digital platforms and solutions that offer real-time visibility and control of authorised signatories across organisational entities, customers
and geographies. This reduces errors, speeds up verification, and supports compliance. Work with technology leaders who offer secure and scalable solutions that will help your, or your clients, finance teams streamline signatory management and reduce operational
risk.
2. Embed ASM into workflows
Financial institutions should look to embed ASM insights into credit scoring, onboarding, and transaction approval processes to streamline due diligence and reduce manual verification. Organisational finance teams should integrate ASM into payment approvals,
financing applications, and trade documentation to accelerate execution and reduce errors.
To support this, finance teams and clients need to understand the strategic importance of ASM. Organisations often underestimate the fraud and compliance risks associated with poor signatory governance. A targeted training programme can help raise awareness
and drive adoption. Sharing real-world case studies can further reinforce the value and encourage meaningful engagement.
3. Use ASM intelligence to strengthen risk assessments and negotiations
Leverage data from digital ASM systems to support the assessment of client governance maturity and payment discipline. These insights can help finance institutions identify lower-risk clients, streamline due diligence, improve portfolio quality, and improve
pricing accuracy. For organisations, highlighting ASM maturity during lender discussions will demonstrate governance strength and help negotiate better financing terms.
Ultimately, strong ASM practices will support financing negotiations and lead to lower financing costs for well-controlled clients.
Whilst digital ASM data offers insight into governance maturity, it must be combined with broader organisational and contextual data to build a more comprehensive and effective negotiation position.
4. Align ASM with KYC / KYB and AML protocols
Ensure that ASM frameworks are tightly aligned with internal controls and external compliance / regulatory requirements. This alignment simplifies onboarding and enhances compliance confidence across the funding ecosystem.
5. Conduct regular ASM audits
Establish a cadence for reviewing and updating signatory records. Regular audits help identify outdated or unauthorised signatories, reducing operational risk and ensuring governance integrity. Digital ASM platforms and solutions can facilitate this process
and improve efficiencies for financial institutions and organisations alike.
Closing thoughts
ASM is no longer just a back-office function, it is a strategic asset and driver of financing success. For corporates, a robust ASM framework can unlock better financing terms and build stronger relationships with funding partners. For financial institutions,
ASM provides a clearer lens through which to look into client governance maturity, enabling smarter risk management and more efficient financing operations.
As the financial ecosystem becomes increasingly interconnected and data-driven, those who invest in ASM as a core component of their governance strategy will be better positioned to thrive.
In today’s environment where supply chain finance, invoice financing, and trade finance rely on speed, trust, and compliance, good ASM – especially digital ASM – is a foundational control.
So now is the time to elevate ASM from a compliance tool to a strategic enabler. Overlooking ASM may not just be a missed opportunity, it may turn out to be a costly oversight that risks becoming a strategic blind spot.
