Elena Christopher — Chief Research Officer, HFS Research[00:05]
Hi, this is Elena Christopher. I’m the Chief Research Officer of HFS Research, and I also lead our financial services research. I’m absolutely delighted to welcome Rajesh Wadhwa, the Global Head of TTS Core Trade and Loan Servicing Technology from Citibank, to have a conversation with me today about what’s going on in the financial services market—and perhaps all markets, if we’re thoughtful about it—in terms of very real macroeconomic headwinds, but in the face of amazing innovation technology. Rajesh, welcome to the conversation.
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[00:43]
Thanks, Elena. Thanks for hosting me. Let me introduce myself. I’ve been with Citi TTS Trade Technology for 20-plus years. For those who don’t know Citi TTS, TTS is Treasury and Trade Solutions, and I’m going to specifically talk about what I do within trade. For those just to demystify, this is not the trading flow; this is international trade. And what I would like our listeners to visualize is the container going in the oceans with big cargoes, having containers of goods. So basically all about import and export business is what global trade is. It’s all about connecting multiple countries, multiple counterparties, multiple sellers and buyers across the transaction flows. And what I do is build the solutions and support the solutions which are responsible for supporting this entire trade across Citibank, which is a 200-plus-year-old Citibank in the business.
Elena Christopher — Chief Research Officer, HFS Research[01:44]
Thank you for that, Rajesh. That was exactly some of the detail that we needed, because I find even some folks who may be part of the financial services ecosystem may not necessarily understand the details of trade within the transaction banking context. So you’re essentially a technology leader. I made a comment in our introduction about the markets today. It’s what we at HFS and what our research has been showing—we’re referring to it as a tale of two cities market. So I’ll wax literary today. But what I mean by that is that it’s really this kind of interesting balancing act: we have all these macroeconomic circumstances with very real impacts in financial services, like some of these recent bank failures, for example. But there’s also this incredible innovation potential. I think ChatGPT and generative AI have captivated the planet. But in your world, there are just loads of interesting technologies that have been making a real difference for a long time, like blockchain, for example. So what I’d love to hear from you, Rajesh, is, as a technology leader, how have you and your team been reacting to these tale of two cities trends today?
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[03:02]
Indeed, it’s a tale of two cities. On the superficial side, it does look like the worst of times, but if you look underneath, there are actually a lot of opportunities which can take us forward. If I look at the trends, I think the biggest thing which is happening around us is the data crisis. Whether you talk about a financial crisis, such as the bank failures you talked about, or whether you talk about a technology crisis like ChatGPT, I call this a crisis because it’s really making you think differently. It’s all about overflowing data around us. So what I think needs to happen is, number one, everybody in the industry, the banks especially, have been focusing on how do you build the data lakes. What’s really with us now is, now you have data lakes, how do you build the data intelligence around it? How do you build the talent, the data scientists who are able to tell you what’s coming, what’s the relationship, what’s next—once you have the first bank failure, what’s going to happen next? So it’s about building the data lakes, building the data intelligence, building the talent to rightly analyze the data. And also the biggest thing is the speed of reporting back to the regulators, which is crucial about how do you sustain in this changing economics every day.
Elena Christopher — Chief Research Officer, HFS Research[04:14]
Yeah, absolutely. The regulatory piece is something that’s certainly not unique to financial services, in that there are many heavily regulated industries, but in the same breath, it is unique to financial services. I always say there are four key levers within financial services. You’re trying to impact your top line, your bottom line, customer experience, and regulatory compliance. So it always exists as something that, if not your primary concern, is always absolutely there. But I think you bring up a fantastic point with data. Our research continues to show it’s always one of the top three challenges. And with that in mind, Rajesh, I’ll ask it specifically as a question—would you regard data, and not just the creation of the big data lakes, but part of what I heard you say is that what you’re trying to do is to ensure all of the capabilities and really almost create a data culture—but with that in mind, would you call data your biggest challenge today?
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[05:11]
I mean, again, I would say data is the biggest opportunity today, right? So we have been—our Citi, over the last decade or so, we have been investing a lot in our data technology, a lot in terms of how do you improve the data gathering around the ecosystem within Citi and outside Citi. And now it’s all about, now you have the data in your data lakes, and now how do you build the intelligence around it? How do you make the decisioning easier? It is one thing to show and report the data, and what really is required today, with the speed at which the industry is moving, is how quickly are you able to use the data to make decisions. So it’s all about building those algorithms, building those insights, and having the right talent of data scientists to enable our business to move forward.
Elena Christopher — Chief Research Officer, HFS Research[05:56]
Yeah, it’s been—I think in a variety of conversations I’ve had, one of the things I think really pushed everyone’s hand during the pandemic was you really had to better rely on your data and build strategies and capabilities and even architecture to enable that, so that you could be playing a bit less checkers and a bit more chess, being able to rely on your data to take those important decisions. Within part of your comments there, you mentioned talent as well. I know it’s part of your leadership role. I believe you’ve got a large team of probably 1,000-plus resources, and you’ve got them some onshore, offshore, near shore. Tell us a little bit about how you managed talent throughout the pandemic, the great resignation, and through to today. Give us a little bit of insight into what kind of challenge that was and how you saw your way through.
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[06:57]
I mean, the pandemic, to me, was a game changer in how we looked at our employees, how did we look at their well-being, how do we look at remote working. So in many ways, it enabled us to look at opportunities of bringing new technologies, bringing new tools for people to work remotely, for people to be more productive while we are not in person. I would say Citi, as an organization—even if you go back to 9/11, we had built a lot of technologies to have geographical resiliency, so we not only have the teams in LATAM, in the Asia continent, in the Europe continent, we also have tools which enable that personal touch. And especially technologies like Zoom and all have been big helpers in that space. But we are back to the new cultural trend here of hybrid working. So Citi has been promoting three days of work, two days of work, depending upon the location you’re working from. And I’m personally a believer that great things happen when you are in conversations together, when you’re in the room together. So I believe in that. The innovations can come out when you are sitting in one location having a conversation, and you can make things happen. Go back to the Olympic motto—better, faster, and stronger together—but the Olympics happen only once in four years. What I believe needs to happen in my department every day.
Elena Christopher — Chief Research Officer, HFS Research[08:24]
Yup. I like your point there, because it’s also what we see in our research, and strongly throughout all sectors. Work isn’t on-site, work isn’t at home. Work is hybrid, and we believe that that’s where it’s going to stay. So let’s talk a little bit about—ultimately, our conversation today is about balancing headwinds and innovation, but I’d love for you to take a moment to talk about some recent innovation-led initiatives that have yielded value for Citibank. Because within your domain of trade solutions, it’s very document heavy, there’s heavy compliance, and you really have a unique supply chain that you’re trying to work through. So tell us a little bit about how you’ve leveraged innovation to really improve the whole process.
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[09:18]
Sure. So Elena, our attempt, or our vision at Citi, has been that every transaction needs to be a completely automatically processed transaction, because that’s the only way you can scale the business, that’s the only way you can be operationally efficient. So our supplier finance, which is very invoice driven, which is very digital, is almost 100% automated business, while our core trade, which is a document-heavy business—that’s where we had set out this goal for ourselves to be completely automated. And that meant digitizing the documents. That meant automated compliance functions, because documents have a lot of data. And that also meant orchestrating the entire workflow for services such as connecting to the clients, pricing the transaction, settling the transaction, making the payments, making the accounting. So some of the successes I’ll talk about is how Trade Technology led the entire trade industry across financial institutions to roll out OCR software, to roll out what we call Compliance NextGen to automate the compliance functions for better accuracy, better efficiency, and how we orchestrate the entire end-to-end processing of a transaction using the latest microservice architecture and the great workflow technologies we have at Citi.
Elena Christopher — Chief Research Officer, HFS Research[10:32]
Now, that’s something—because we like to talk about outcomes and what you’ve actually achieved. So have you been able to get there? I think, generally speaking, in the world today, hitting 100% of straight-through processing on anything just doesn’t exist. Tell us a little bit about what you’ve achieved.
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[10:32]
So what we have achieved is, transactions which used to take 48 to 72 hours earlier now get completed in minutes. We have been able to achieve an efficiency of greater than 25%-plus in the overall processing times. We are leading the industry—we had presentations to some of the regulators back in India, and even in the US, about how we are doing our compliance automation, how we are doing at transaction processing automation. So yes, we are seeing a lot of success with the new technologies and the new tools we are building.
Elena Christopher — Chief Research Officer, HFS Research[11:00]
Fantastic. Thank you for that—I always love the detail and the stats, if you will. I wanted to also take a moment and ask you about ecosystems. HFS defines ecosystems as unrelated entities coming together to generate new forms of value. And some recent research that we’ve done—our data has been showing that financial services firms are starting to think of partnership ecosystems as a growth driver, as much of a priority as driving revenue and profitability growth. In your particular domain, within transaction banking and trade, within financial services, I’d love your thoughts on the role of ecosystems. What do you see, and what are you doing to potentially leverage them?
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[12:16]
Sure. Let me just take a moment to talk about Citi. Citi has always been a champion of ecosystem, whether you talk about rolling out ATMs to consumers, whether you talk about ACH payments to corporates, whether you talk about rolling out consumer cards. And that ecosystem, to your point, is really changing from a business perspective as well as from a technology perspective. Let me talk about what I call an ecosystem. We have new fintechs providing niche solutions. We have new marketplaces coming up connecting buyers and suppliers, connecting logistics companies. We have multi-bank portals coming up, allowing clients to have a one-stop shop to connect with multiple large institutions. We have blockchains coming up. We have data aggregators coming up. So you’re absolutely correct. It is essential for the banking technology to have integrations with all these new marketplaces, the new fintechs, for us to have, number one, the cutting-edge technology which is out there for us to be able to have efficient solutions for our clients. And what Citi has been doing about it is, number one, the API architecture. We are hugely focused on API-based architecture. We have built a lot of integration technologies which will give us the speed to integrate with this new ecosystem around us. And I absolutely think it is important that we have data security, cybersecurity around this ecosystem. It’s absolutely essential for us to drive the industry forward.
Elena Christopher — Chief Research Officer, HFS Research[13:44]
Yup, absolutely. And you mentioned DevOps earlier—I always like to say DevSecOps. You have to bake the security into the design as well. Fantastic. All right, Rajesh, this has been a fantastic conversation. I would like us to end on an actionable note. So, given some of the topics that we’ve talked about today, what recommendation would you like to make to your peers across all sectors about how to make progress and impact with innovation during these challenging times? What do you think?
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[14:16]
I would say, one, focus on the client. Listen and analyze the client feedback. Find the real need of the client—that’s one. Number two, data. Data lakes, data intelligence is a must-have. It’s not a nice-to-have anymore. Number three, I would say talent. You need to have the right organization structure, skilled staff—team is what you have. You’re as good as your team. Number four, I would say it’s important to have a clear vision. Have a defined strategy and execution roadmap, and be flexible, be adaptive as you move along. And lastly, as you said, the ecosystem is key. Understand the ecosystem, identify the right partners, and accelerate your API-driven architecture.
Elena Christopher — Chief Research Officer, HFS Research[14:42]
Fantastic. OK, Rajesh, thank you so much for those insights. I think within all of those, you gave us a bouquet of recommendations. I would just make the final comment that I think there’s so much more to be done with ecosystem. But that’s us for today. Rajesh, thank you so much for the conversation today. And that concludes our impact interview. Thank you.
Rajesh Wadhwa — Global Head of TTS Core Trade and Loan Servicing Technology, Citibank[15:11]
Thank you. Thank you, Elena. Thank you for hosting. It was a good conversation. Thank you.
