Through the prism of transaction banking
Euromoney Limited, Registered in England & Wales, Company number 15236090
4 Bouverie Street, London, EC4Y 8AX
Copyright © Euromoney Limited 2024
Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement
Sponsored Content

Through the prism of transaction banking

Sponsored by


This year marks a decisive year in the global economy, and the transaction banking industry that facilitates it. In every region, we have seen how eCommerce, new technology and changing regulations are prompting new business models, faster or real-time payment methods and changing customer expectations, both at a consumer and corporate level. While the underlying trends may be similar, however, the implications for transaction banking in each region are quite different, demanding a multi-faceted approach to address the distinct strategic challenges and opportunities.




Alex Manson

Global Head, Transaction Banking, Standard Chartered Bank


Setting the pace of innovation

The concept of ‘anytime, anywhere’ banking, with a focus on speed and optimal client experience, has become essential to facilitating commerce. Banks, as a result of either being prompted by regulators or wanting to defend their market share, are responding to this demand far more quickly than in the past. The nature of this response however, depends very specifically on the market in question. Looking at real-time payments, for example, the business imperative is less immediate and therefore (with some exceptions such as Sweden and the UK), the speed of delivery has generally been slower in Europe and North America. These regions already have a more-or-less efficient payment infrastructure, so the acceleration of payments is more gradual.

The starting point and pace of innovation also varies across markets. In parts of Asia and Africa, rather than upgrading existing payment infrastructures, many countries are building digital payments infrastructure from scratch. The digital payments strategy in Africa and Asia is being strongly influenced by the ubiquity of cell phones: according to the 2016 Global Mobility Report, smartphone penetration rates for Africa and Asia were 82% and 51% respectively. This is fuelling the huge rise in mobile wallets and mobile payments, such as M-PESA in East Africa and parts of Asia, and WeChat and Alipay in China. While these solutions may ultimately be rolled out into Europe and North America, the value proposition is less immediate and compelling given that there is already a choice of efficient payment methods. 

Architects of change

Depending on the markets, the architects or drivers of change also vary considerably. In India, payments innovation has been largely government-driven, leading to the UPI (unified payments interface). In China, digital payments accompanied the explosion of eCommerce and social media. Singapore too has very different drivers as it seeks to reinforce its position as the primary regional trading hub. In Europe, while there are distinctions in payment culture and levels of digitization, a single currency and single euro payments area (SEPA) has limited these variations. The challenges of a highly fragmented banking landscape and significant use of cheques in the US, also create quite different conditions and therefore drivers of change, with significant regulatory and disrupter influence.

The end of a global era?

Given that every market represents an individual ecosystem, and that trade and payments innovation needs to take place in the context of each market situation, does this negate the concept of global transaction banking where only domestic banks are relevant? I would argue that it does not.  In fact, now more than ever, while difficult to do, a successful bank will need a clearly defined value proposition that meets the specific needs of both clients in local markets and multinational clients who demand not only strong domestic expertise and solutions, but also common platforms, cross-border liquidity solutions and a cohesive approach to service delivery. 

The sweet spot is to meet both sets of needs – on the ground expertise in especially complex and disparate markets or regions but with the ability to connect the dots and offer the same banking experience globally. For example, at Standard Chartered, although UPI in India, FAST in Singapore and CNAPS in China are all quite different, we support them through a single platform, enabling our clients to implement common processes and reporting.

The role of banks in connecting business communities

The role of international banks with regional specialization becomes particularly apparent taking a wider view of transaction banking across both cash and trade. Here we see transformational changes taking place, largely originating in emerging markets, where 60% of global supply chains are forecasted to be by 2030, including 39% in Asia[1].

The emerging markets is characterized by fragmentation and supply chains that are continually shifting, in line with changes to infrastructure development, the cost of labour and geopolitical conditions. This situation creates very specific transaction banking needs with growing demand for banks that can deliver services across disparate trading ecosystems. At Standard Chartered, we bank the ecosystem by connecting business communities, from small retailers to the largest multinationals. Since introducing the strategy a year ago, we have onboarded more than 30 anchor clients and nearly 1,100 suppliers and buyers.

A prism approach to facilitate growth

With much of global growth and innovation now driven by the emerging markets, this region can no longer be ignored. By 2020, the emerging markets are expected to account for 50% of the global GDP with 38% of the world’s consumer spending and 55% of the world’s fixed capital investment.[2]  Asia for example now comprises six of the world’s largest trading hubs and international trade is expected to nearly double by 2030 from where it was in 1990.  The question is therefore, how banks can continue to support the trading and investment activities of their corporate clients in this region. 

And while it is clear that, local, regional and global banks play a very distinct and often complementary role; in the end, clients need their partner banks to take a ‘prism’ approach in supporting their growth aspirations. Just as a prism disperses white light into its constituent spectrum of colours, a successful bank must be able to provide banking on a single, consistent platform across regions and at the same time have the ability and flexibility to cater its spectrum of solutions to each of those markets.  And only when this is done effectively, can transaction banks play the very important role of facilitating global trade and payments which remains the lifeblood of any economy. 

[1] Standard Chartered Global Research: Global supply chains: New directions

[2] EY report: The growth potential of emerging markets 


This material has been prepared by Standard Chartered Bank (SCB), a firm authorised by the United Kingdom’s Prudential Regulation Authority and regulated by the United Kingdom’s Financial Conduct Authority and Prudential Regulation Authority. It is not independent research material. This material has been produced for information and discussion purposes only and does not constitute advice or an invitation or recommendation to enter into any transaction.

Some of the information appearing herein may have been obtained from public sources and while SCB believes such information to be reliable, it has not been independently verified by SCB. Information contained herein is subject to change without notice. Any opinions or views of third parties expressed in this material are those of the third parties identified, and not of SCB or its affiliates.

SCB does not provide accounting, legal, regulatory or tax advice. This material does not provide any investment advice. While all reasonable care has been taken in preparing this material, SCB and its affiliates make no representation or warranty as to its accuracy or completeness, and no responsibility or liability is accepted for any errors of fact, omission or for any opinion expressed herein. You are advised to exercise your own independent judgment (with the advice of your professional advisers as necessary) with respect to the risks and consequences of any matter contained herein. SCB and its affiliates expressly disclaim any liability and responsibility for any damage or losses you may suffer from your use of or reliance on this material.

SCB or its affiliates may not have the necessary licenses to provide services or offer products in all countries or such provision of services or offering of products may be subject to the regulatory requirements of each jurisdiction. This material is not for distribution to any person to which, or any jurisdiction in which, its distribution would be prohibited.

You may wish to refer to the incorporation details of Standard Chartered PLC, Standard Chartered Bank and their subsidiaries at

© Copyright 2017  Standard Chartered Bank. All rights reserved. All copyrights subsisting and arising out of these materials belong to Standard Chartered Bank and may not be reproduced, distributed, amended, modified, adapted, transmitted in any form, or translated in any way without the prior written consent of Standard Chartered Bank

Gift this article