Best Emerging Markets Platform – Citi

As was the case in the pre-Covid years, Citi has been one of the big investors in its FX technology over the past 18 months to two years. Part of the spend has been on the bank’s well-publicised slimming down of the venues it connects to, in turn part of an effort to simplify what was a very complex technology platform and business framework just a few years ago.

The majority of investment, however, has been on making Velocity a true one-stop shop for the banks FX services. The bank’s superbly functional Pulse platform for corporates was first to be integrated and the bank is in the throes now of completing the process with its prime brokerage platform, Click. The latter of course, was the model that drove so much of the look and feel of Velocity’s later iterations, giving the entire platform a modern feel whilst still providing the ability to drill down with a small number of clicks.

The other area the bank has been focusing on is workflow, specifically solving a problem that has bugged Citi for the best part of two decades – the sheer number of services available and the sign-ons required. If there is one theme that comes through from the Citi journey over the past year or two (and it’s not over yet), it is bringing unity to what was a series of disparate – but loosely connected – services that were built by different parts of the business over a period of time.

This work requires a business structure that can complete such an onerous task and that too has been part of the journey, but there are early signs of success. Users tell us they are more engaged with Velocity on a broader basis than before, simply because it has become easier to access everything.

In terms of functionality, Velocity looks familiar, but again, there has been significant work behind the scenes to speed up everything, from onboarding, through pricing, to post-trade management. In terms of growth, leaning into its very strong corporate franchise that loved Pulse, the bank is targeting custody FX – another largely rules-based transaction model. While it is likely to see significant success here given the functionality of Pulse lends itself so well to such trading, it was notable that at least three other banks that we saw also highlighted their work to capture more of this business. Clearly greater competition is coming to custody…

Overall then, the story of Citi over the past two years has been consolidation, work behind the scenes to improve the client experience, and a slimmer structure to the business. It has also built closer ties with its payments business, another area for the Pulse functionality, probably as part of an effort to integrate the platform into the wider bank’s infrastructure.

Take these improvements on top of what was already a very good platform, and then push them into the emerging market arena, where a more prosaic fact about Citi plays a big role – it’s global footprint.

Effectively, across all FX services and products, for all types of clients, Citi is delivering a G10 experience in emerging markets. This is being done elsewhere, of course, but not on such a scale – which is why the work to improve the tech infrastructure and client experience was so vital. Differentiating oneself in G10 is very hard, in EM, it’s difficult but there are still opportunities – and Citi is grabbing them with both hands. From the broad sweep of Pulse’s offering that takes into account every nuance of a local market, to the specific work to ensure that the payments business has a better operating environment globally, Citi has built an excellent platform.

Velocity has always pleased the user from a visual experience, but there were frustrations about the different pieces attached to the side of it, this has now changed. The FX business itself has also changed, with, as noted, more connection to the bank’s other business units that inevitably cross over with FX. Whether it be in payments or investor services, across algos, options and NDFs, for corporates, asset managers, hedge funds and banks, Citi is creating a one-stop shop. At the moment, this is manifesting itself more in emerging markets, because the bank is leveraging its position in these centres, going forward, however, expect to see Citi challenging to back on top of the stack in all areas.