MANHATTAN-BASED global banking giant Citigroup is one of the biggest money movers in the world.

“Every day, we move US$3 trillion around the world,” Naveed Sultan, global head of Citi’s treasury and trade solutions business, told Shanghai Daily. “It can peak at around US$8-9 trillion. But even with the average, we turn around the GDP of North America within a week.”

Sultan is a Citi veteran of more than 20 years. Currently, he’s in charge of the multibillion transaction banking business, with more than 13,000 employees globally providing services related to trade and supply chains, export agency financing, liquidity and investment management, wholesale card services, information services, receivables, consulting and digital services.

Sultan holds a master’s degree in management from MIT’s Sloan School of Management and an MBA from the Institute of Business Administration in Lahore, Pakistan.

The treasury and trade solutions business contributes approximately 10-12 percent of Citi’s revenue. In terms of margin and net income, the contribution is far greater, according to Sultan.

Last month Citi held its annual flagship treasury and finance conference in Shanghai. During an exclusive interview with Shanghai Daily, Sultan talked about the initiatives the bank has taken to improve transaction banking services in today’s changing world.

Q: What makes the treasury and trade solutions business so important within Citi?

A: If you look at Citi’s business operating model, there are two prominent things. One is our globality, and the second is the multi-geographic client relationship.

To a very large extent, treasury and trade solutions are underpinning these two competencies. Driven by technology, we integrate ourselves in middle and back offices. We are the network, and we supply information and insight into the global operations and flows. So, in this context, treasury and trade solution is really a strategic business for the company.

If you look at the economic profile of this business, it really balances the company’s profile. We have very attractive returns. We are balance sheet light and very responsive toward regulatory environments.

We are the market leader in terms of absolute numbers, but the absolute numbers don’t reflect the true value of this business. We provide liquidity to the company, which is of paramount importance under the Basel III regime and after the global financial crisis. Secondly, we generate flows for other parts of the company. We process about US$3 trillion each day on average. That’s very important because a significant amount of foreign exchange is associated with that. Additionally, we also cross sell other parts of the bank. It’s the most efficient network business in the industry.

Q: What’s the customer segment of transaction banking at Citi?

A: Our customers are primarily multinationals, top-tier local companies that are sizable or they have intentions to go international, and also the micro-multinationals that have a digital presence in the world without being large.

In addition to the top two primary segments, there are two sub-segments: banks and governments.

We have a client base that includes more than 90 percent of the top 500 global companies, as well as hundreds of public-sector clients and banks, asset managers and insurance companies in over 120 countries.

Our core strength is assisting clients around the world. That strategy has been in place for the last 200 years. We detect and recognize trends of globalization, and we want to go wherever around the world our clients need us to assist them and help them execute their global objectives. Companies grew with us, and we grew with them. So wherever we thought that was the direction of a company, we opened a branch and hired local talent there.

Q: What are the most pressing issues facing chief financial officers in multinational companies?

A: First of all, it’s how you manage financial flows in a globally changing environment, which is driven by regulatory changes, geopolitics and technology. The second is to become more efficient, more optimized. The third is about instant access to information. Fourthly, better insights of data analytics so as to make better decisions.

CFOs are dealing with an incredible changing and challenging environment — globalization, urbanization and digitization. How you adapt and stay competitive is critically important.

Q: How have banking services evolved to better meet the pressing needs of CFOs?

A: We see the world in the context of three secular trends: globalization, urbanization and digitization. They are mutually reinforcing trends. Our global network helps us naturally position ourselves in those trends.

According to research, another 300-400 million people are expected to move to urban centers in the next 15 years, , which is considered to be the largest migration in the human history. We are investing in China, and we have a very sizable presence here. We believe wealth creation and aggregation will happen in urban centers. We want to address the needs of the population in cities.

Digitization really widens the world into a single market, which leads to the increase of flows and statistics, and, on top of that, economic development. We believe it leads the future and will create a much better client experience. We have continued to invest in new capabilities, and we have two innovation centers in Singapore and Dublin. These two centers are supporting our efforts in digitization. Within that, new ideas come. For example, we are exploring the digital money concept and we are investing in big data analytics.

Q: Why does the digital money concept interests Citi?

A: Digital money is different from virtual currency, such as bitcoins. It’s the transformation of the physical instruments into pure digital forms, enabling fund transfers through digital channels. If you look at the US, it’s very paper intensive. That’s very prevalent in many countries around the world. We believe that as digitization occurs, the ability to move funds around in digital means is going to become absolutely critical. It’s hugely beneficial for the efficiency of the economy, for better revenue or tax generation for governments and for better productivity for corporations, including the banks. So for the system as a whole, it generates a lot of efficiency and productivity, which can be generalized as more value-added. For example, if all the global flows were going through digital channels, the ability to implement anti-money laundering and “know your customer” procedures would improve quite significantly. It would be a lot easier to detect the origins and destinations of the flows. Digital money already is starting in many markets around the world. It’s only a question of time for policy and regulatory frameworks to be ready for different countries to embrace digital money.

Q: What about the development of transaction banking in China?

A: China is going to play very important roles in the global economic landscape. As we move forward, even a greater role. We see opportunities to build best practices in this country to facilitate economic growth for Chinese businesses and for multinationals with operations in China.

Transaction banking has become a fundamental tool, not only in that we help clients realize their goals, but also in facilitating economic policy goals because we facilitate globalization.

It is the backdrop of our relationships with our clients. The wholesale banking products we sell to them include the whole spectrum of equity capital markets, debt capital markets, mergers and acquisitions, advisory services, foreign exchange and derivatives. Below that the core foundation of what we do is transaction banking — cash management and trade services. It’s on the back of that really sticky global network-based business where you create flows, and then you can do all the other things with clients.

What’s happening in China is driven by what we are doing globally. It’s not just outside-in, but it’s inside-out as well. The Chinese yuan is no longer just a domestic currency. It’s a rapidly rising global currency. Not just on China’s mainland, but also in New York, London, Frankfurt, Hong Kong, Taiwan, and Singapore. We are a big bank in US dollars, euros, sterling and yen, and now we are playing a dominant role in taking the yuan international. Yuan capital injection, multi-currency pooling, cross-border sweeps — these are becoming the dominant topics of conversation with clients in terms of how we develop our Citi transaction banking global business.

The core foundation of what we are doing in the Shanghai pilot Free Trade Zone is all about the transaction banking business, which enables flows through the FTZ for our clients over here, connecting them with the outside. We are focusing on centralized settlement for yuan, automated pooling, and also netting transactions. These are the core competencies of transaction banking.