Offered across 41 currencies in 96 markets, Citi Virtual Accounts enjoyed a stellar 2022, appealing in particular to corporations, financial institutions, e-commerce and insurance companies. The Citi pitch is easy to summarise-harder to execute-namely help multi-nationals improve operational efficiency, reduce costs, accelerate time to market and ramp up their digitisation initiatives. In 2022, account balances grew by 82%, accompanied by 33% growth in adoption.

Virtual Accounts – a strategic success for Citi TTS

Citi Virtual Accounts is a global solution that offers many benefits over traditional account structures including:

  • bank account simplification;
  • real-time cash concentration and account segregation based on a company’s operating model;
  • instant access to cash management capabilities;
  • A fully automated and digitalised onboarding experience;
  • streamlined execution of documentation and minimized IT requirements for clients – with accounts opened and transactional within 24 hours- previously, this process could take months, and
  • domestic, international and instant payment options across multiple payment methods, spanning high value and low value payments

New solutions, talent acquisition, profits rise

RBI speaks with Steve Elms, Global Head of Corporate, Commercial and public-sector sales at Citi Treasury and Trade Solutions: can you summarise 2022 highlights for the virtual accounts offering?

Elms:

Citi TTS provides a wide range of financial services to corporate and institutional clients, such as cash management and trade finance The business will continue to focus on providing innovative solutions to meet the evolving needs of its clients in the coming year. Last year was a strategic success for Citi TTS – new solutions were released, future offerings were announced, TTS hired and retained top talent, and profits grew.

Just last year, we announced a number of new solutions including:

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  • Citi 7-Day Sweeps in the US and South Korea. This is a cash management service that allows clients to optimise the management of their cash balances and concentrate liquidity seven days a week. Historically, this hadn’t been automatically executed on weekends and holidays, requiring manual transfers to ensure sufficient liquidity.
  • Citi (24-7 real-time) USD Clearing: An offering that helps a wide range of clients, including banks, corporations, and other financial institutions, clear and settle US dollar-denominated transactions across all of its 1,500 financial institution customers 24×7 and 365 days a year. This enables clients to process their transactions in a more efficient and cost-effective manner, allowing clients to harness the growth of far East markets, meet collateral requirements on weekends or holidays, process late-hour payments, support Interbranch funding, and empower clients’ customers to process payments at any time.
  • Spring by Citi Integration with Citi Present and Pay: Built on top of Citi TTS’s industry-leading and proprietary payments network the Bank combined two of its best-of-class services into one integrated platform to help institutional billers in the US address pain points associated with accepting digital payments. This offering provides clients with a one-stop shop to manage their payments as companies across sectors are rapidly expanding their e-commerce offerings in an increasingly competitive environment.

Citi TTS is working on many innovative solutions that will launch in the coming months.

$4trn daily flows on average

RBI: Looking ahead, what targets have you set and where do you expect to see further growth and from which market segments?

Elms:

With Citi’s footprint of 96 markets, we play a pivotal role in payments processing $4trn of daily flows on average. Our unique vantage point allows us to understand shifts relating to macro-economic and geopolitical impacts. The breadth and flexibility of our solutions means our approach to small and large clients is highly positioned to solving growth opportunities and their problems and challenges.

The role of payments have become even more business-critical as brands continue to expand their offering, improve client experience and expand their customer reach to meet evolving consumer behaviours and expectations, including the role of e-commerce.

RBI: Summarise the Citi USP here-what is the pitch to multinationals to utilise virtual accounts?

Elms:

Citi Virtual Accounts helps clients operate with a more streamlined banking structure, centralised liquidity, improved controls and simplified reporting, alongside a material reduction in back-office admin processes that greatly improved efficiency. Leveraging the strength of its global network, Citi is extending the market for financial services by creating differentiated experiences for clients as they accelerate expansion and growth. Citi’s integrated platforms help clients streamline operations, improve customer experiences and increase revenue.

Our frictionless end-to-end solutions help drive client growth and ensure they’re able to offer better banking and payments solutions to their customers faster. Accounts with domestic, international and instant payment options across multiple payment methods, can be opened and transactional within 24 hours across 41 currencies. Citi Virtual Accounts also supports clients to implement their e-commerce strategies with reduced investment needs in their own technical infrastructures. In 2022, account balances in VAs grew by 82%, and we saw a 33% growth in adoption. We expect to see e-commerce brand usage continue to grow over the coming years

2023: significant growth on horizon for Citi institutional virtual accounts

RBI: How do Citi virtual accounts highlight the bank’s drive to be viewed as a digital innovator

Elms:

As payments and commerce continue to become more digitised, more integrated, we are able to bring our full TTS platform to provide end-to-end digital solutions for financial supply chains in a 24×7 environment. We expect to see significant growth in this space for 2023 and for years to come.

These services will become critical in the disruption we see across industries and as countries explore the potential of technology and innovations in payments as an enabler to drive economic growth.

RBI: How is Citi winning business in markets where, in recent years, it has been on the retreat on the retail banking/consumer side?

Elms:

With the ability to clear USD across its 1,500 financial institution customers 24x7x365, Citi can connect its clients around the globe at any time. Operating in 96 countries and in over 140 currencies, Citi maintains the largest global network, allowing the bank to offer unrivalled reach and choice for its clients. This keeps Citi competitive as customer expectations are quickly evolving and competition grows.

With a presence in 96 markets, our offering empowers clients to manage their accounts physically and virtually. As clients continue to look for opportunities to optimise their cash management and working capital, new innovations will continue to drive such opportunities.

Citi’s multi-currency notional pooling (MCNP) offering, which allows clients to minimise bank interest costs by concentrating end-of-day balances into a single net account across borders, helps clients achieve substantial liquidity, financial and operational benefits by automating the funding process. MCNP can be utilised with Citi Virtual Accounts, which allows clients to segregate their balances under a single account to provide better visibility and control through centralised payments, receivables, and liquidity management.