When BNP Paribas partnered with Kantox in September 2019, the bank referred to demand from corporate clients for improved efficiencies in cash-flow forecasting through a fully automated hedging solution as a justification for the tie up with the currency management fintech.
The product was developed in 2016 to automate FX risk management, giving corporates real-time visibility of FX exposures and hedging transactions to minimise the profit-and-loss impact of transactional FX risk.
The rationale for the partnership was simple, explains Jacques Levet, chief digital officer at BNPP, who adds: “If a solution exists to a problem that our clients haven't solved yet, why try to reinvent it?”
It is very unusual for the bank to acquire a fintech firm outright, which is why it uses partnerships to test the product, to see if it delivers the promised value.
Kantox has built an end-to-end solution and a rules-based engine that mirrors the hedging policy of the client
“This is also about getting to know the people and the culture,” says Levet. “We need to make sure that they can deliver beyond what we can see right now and that our cultures are compatible.”
BNPP
