AirAsia, JPMorgan, and Ant International Team Up to Revolutionize FX Management
AirAsia, in collaboration with JPMorgan and Ant International, has developed a comprehensive platform and service offering to manage money movements and foreign exchange risks. This joint venture aims to streamline payment processes and risk management for the airline giant.
AirAsia, through its holding company Capital A, is set to benefit from a significant reduction in hedging costs, with a 40% decrease reported by Group CEO Aireen Omar of BigPay. Ant International estimates potential FX cost savings of up to 60% for selected currency pairs using similar systems.
The partnership, facilitated by Ant International's digital platform, combines the expertise of global banking giant JPMorgan with Capital A's operational needs. JPMorgan provides infrastructure for treasury management, including currency management, liquidation, and risk assessment. AirAsia, with its 2.9 billion annual payment transactions worth US$1 trillion, stands to save millions in payment-related costs, which currently amount to over US$20 billion.
Kelvin Li, General Manager of Platform Tech at Ant International, views this collaboration as a milestone in transforming treasury and FX management for businesses. The model, trained on 2 billion parameters and 80 million travel-related data points, is designed to meet the FX needs of the aviation sector. Both companies plan to expand AI-driven FX and treasury management capabilities through Ant International's Bettr Treasury Platform.
The partnership marks the first industry-specific solution built on Ant International's Falcon platform, launched in April. Capital A has partnered with Ant International to use AI for managing cash flows, reducing costs, and stabilizing pricing for customers. The AI system, powered by Ant International's Falcon Time-Series Transformer (TST) Model, forecasts cash flow and FX exposure with 90% accuracy. This integration with Capital A's corporate banking partner's fixed FX rate infrastructure completes transactions for AirAsia, promising a more efficient and cost-effective financial management system.
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