Citi and Ant International have begun piloting the use of Ant International’s Falcon Time-Series Transformer (TST) Model to enhance foreign exchange (FX) risk management for clients, beginning with applications in the airline industry.
The Falcon TST Model, which is based on transformer architecture and comprises nearly 2 billion parameters, integrates advanced time series forecasting algorithms.
It is designed to analyse large volumes of historical data to predict future trends in cashflow and FX exposure.
The model aims to support businesses in improving forecasting accuracy and reducing hedging costs.
The joint solution pairs Ant International’s forecasting capabilities with Citi’s Fixed FX Rates solution, which allows businesses to lock in FX rates across more than 70 currencies.
This mechanism offers clients a degree of protection from currency fluctuations and supports planning and pricing strategies, particularly for companies operating across multiple currencies such as airlines, travel firms, and e-commerce businesses.
Developed with aviation clients in mind, the pilot targets the airline sector, which processes billions of payment transactions annually and faces ongoing challenges related to currency volatility.
Ant International reports having reached over 90% forecast accuracy in its internal use cases.
The company also notes a 30% reduction in hedging costs for a pilot airline customer using the joint solution.
Citi has already completed FX transactions using the combined model for one of Asia’s leading carriers.
“We are constantly evolving our products and solutions to support new use cases built on our clients’ priorities,”
said Sam Hewson, Global Head of FX Sales at Citi.
“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.”
Kelvin Li, General Manager of Platform Tech at Ant International, said:
“This is the first industry-tailored solution developed from our Falcon TST Model with a bank partner to serve their customers. 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 FX hedging.”
Featured image credit: Ant International
