Citi has partnered with Ant International to pilot an AI-enabled forex risk management solution designed for the airline industry.
The airline sector, which processes billions in payment transactions annually, is expected to benefit from this joint solution that combines Ant International’s expertise in airline payments with Citi’s robust forex solutions.
The goal is to enable clients to manage their forex costs more efficiently.
This collaboration aims to leverage Ant International’s Falcon Time-Series Transformer (TST) Model, a transformer architecture-based big data model.
The model, with nearly two billion parameters, incorporates the latest time series forecasting algorithms and utilises advanced AI technology to predict future data points and improve cash flow and forex exposure forecasts.
The model helps businesses enhance the efficiency and accuracy of financial forecasts, allowing for reduced hedging and overall forex costs.
Citi global head of forex sales Sam Hewson said: “We are constantly evolving our products and solutions to support new use cases built on our clients’ priorities.
“Citi’s Fixed FX Rates solution supports some of the world’s largest e-Commerce and Travel names and this innovative solution sees us leveraging best-in-class technology capabilities in the broader ecosystem to accelerate go-to-market use cases.”
Citi’s Fixed FX Rates solution, when paired with the Falcon TST Model, offers businesses a way to mitigate currency fluctuation risks by ensuring fixed forex rates for a defined period, according to the companies.
The solution supports more than 70 currencies and provides greater predictability in budgeting, pricing, and profitability for sectors such as airlines, travel, and e-commerce.
Ant International’s AI-powered forecasting capability is expected to refine the precision of sales and forex exposure predictions for businesses.
The company has already achieved a more than 90% accuracy rate in its use cases and anticipates that the solution will help airlines lower their forex hedging expenses as forecast accuracy improves.
Citi has demonstrated the effectiveness of this combined solution by completing successful forex transactions for one of Asia’s leading carriers, resulting in reduced forex hedging costs during initial live transactions.
Ant International general manager of platform tech Kelvin Li said: “This is the first industry-tailored solution developed from our Falcon TST Model with a bank partner to serve their customers. It’s an important milestone in our journey to leverage AI for forex management for our businesses, partners, and also merchants.
“The 30% hedging cost savings Ant International has achieved for the pilot airline customer shows the cost efficiency that can be achieved with AI-enabled forex hedging. We are excited to expand the solution with Citi to serve more businesses and industries.”
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