North America's financial system is undergoing rapid transformation as trade, supply chains, and digital commerce increasingly move across Canada, the U.S., and Mexico. For banks and their corporate clients, modernizing cross-border payments and treasury infrastructure is no longer optional – it's a strategic imperative.
In this American Banker LEADERS episode, John Hunter, Managing Director of U.S. Global Transaction Banking at Scotiabank, explores what modernization really looks like in a North American context – where businesses operate across borders every day and expect real-time visibility, seamless flow, and resilient infrastructure.
John shares how Scotiabank is approaching U.S. Cash Management expansion with a deliberate, client-first strategy, and how banks can evolve their platforms and partnerships to meet rising expectations for speed, integration, and data.
Topics discussed include:
- How regional connectivity and modernization can help enable seamless and data-driven financial operations and create a competitive edge.
- How modernization – APIs, real-time rails, and data-rich payments – reduces friction and improves decision making
- Why executives increasingly expect real-time visibility into cash, payments, FX, liquidity and risk across borders
- How executives balance the pursuit of new opportunities with managing the inherent risk of managing regulatory compliance, sanctions screening, fraud/AML and data privacy.
Transcription:
Transcripts are generated using a combination of speech recognition software and human transcribers, and may contain errors. Please check the corresponding audio for the authoritative record.
Michael Moeser (00:11):
Hello everyone, and thank you for joining us. I'm Michael Moeser, senior content strategist at American Banker, and I'll be your host for today's leaders episode, modernizing North American Treasury, real-time cash, connected markets, and cross-border advantage. North America's financial system is undergoing rapid transformation as trade, supply chains, and digital commerce increasingly move across Canada, the US, and Mexico. For banks and their corporate clients, modernizing cross-border payments and treasury infrastructure is no longer optional. It's a strategic imperative. Joining me today in this leader's episode is John Hunter, Managing Director of US Global Transaction Banking at Scotiabank, as we explore what modernization really looks like in a North American context, where businesses operate across borders every day and expect real-time visibility, seamless flow, and resilient infrastructure. John will share how Scotiabank is approaching US cash management expansion with a deliberate client-first strategy and how banks evolve their platforms and partnerships to meet rising expectations for speed, integration, and data.
(01:26):
Welcome, John.
John Hunter (01:28):
Thanks, Michael. Happy to be here.
Michael Moeser (01:31):
Well, to start off, John, tell us a little bit about your background and your role at Scotiabank.
John Hunter (01:36):
Yeah, Michael, thanks for asking. So my name's John Hunter. I lead the global transaction bank for Scotiabank in the US. In my role, I'm responsible for driving the strategic direction, performance, and delivery of solutions for cash management, transactional FX, working capital, and all the other cash management services across the US, Canada, and globally. I joined Scotiabank after about two decades in the payments business. I had leadership roles in product development and then innovation at Wells Fargo, Swift, JP Morgan, and other institutions here in the US. It's been an exciting year, and we're happy to be here to talk about this capabilities in the overall North American corridor.
Michael Moeser (02:26):
Well, can you elaborate on why this North American market is so important to Scotiabank, its strategies regarding treasury management, cross-border payments, et cetera?
John Hunter (02:36):
Sure, absolutely. So first of all, Scotiabank is recognized as one of the largest financial institutions in the footprint. We have a strong footprint in Canada, strong footprint in Mexico, down through Latin America and the Caribbean, as well as a footprint in Europe and Indonesia. The North America corridor is really core for Scotiabank. So frankly, it's growing faster than any other corridor, including Southeast Asia. Over the last 30 years, it's contributed twice as much to global GDP as Europe. And this interconnected economies of Canada, US, and Mexico really are the key reasons for this, Michael. So when we think about Scotiabank, we believe we have a unique opportunity to connect those markets for our clients. So Canada, US, Mexico, it represents about 1.4 trillion in trade, making it one of the most active trade regions in the area.
Michael Moeser (03:39):
That's definitely pretty big, not insignificant. So I guess as the leader of Scotiabank's US global transaction banking business, what distinct factors make this North American corridor at 1.4 trillion, I think you said, with a T, especially what makes it a dynamic environment, especially for treasury modernization?
John Hunter (04:05):
Yeah. When you think about North America, we have very strong markets where we've had strong clients and strong business for years, and it has become a global dominant power when you think about trade and you think about commerce. And so the thing that makes it so unique is the fact that it's diversified. We have almost every kind of commerce here in this footprint that you could imagine. We have industrials, we have mining, we have energy, we have those kinds of things. We have retail, we have fintechs, we have all of these things that drive innovation and drive commerce globally. And so both infrastructure, innovation and commerce all fit together in this one really unique market. So it's super important. And mostly anyone who's playing in the globe, they tend to have a footprint and a need to participate and play with North America.
Michael Moeser (05:07):
Well, it sounds like a complex market. I mean, not just a single unified thing that is sort of easy to solve, but sounds like you've got the capabilities to, I guess, work across these complex markets and environments.
John Hunter (05:23):
No, listen, it's not simple, right? It's multiple regulatory regimes, different ways of doing business, different currencies, which do cause complexity. But if you can figure it out, flip the switch and begin to open the market, it's going to provide value for tons and tons of clients who are trying to fit and figure out how to participate in the market.
Michael Moeser (05:51):
So now in this complex environment, I guess I've got to ask, why are executives increasingly expecting real-time visibility into payments and liquidity across borders? I think as you and I chatted earlier, is this that Amazon shopping effect where I can now see I buy something on Amazon, I can see where it is in the shipment, where it is in the process. I guess does that translate now to where's my money? Where's the liquidity?
John Hunter (06:20):
No, absolutely. So executives today accept that same experience and that same transparency and that same kind of intimacy that they have with their own consumer transactions. They expect to have those replicated in a corporate space. So you think about Uber, you think about UPS tracking, you think about our ability to be able to see where we are, what's happening, and what real-time status is of things in our day-to-day lives equate very clearly to the way that corporates are beginning to pivot. There's the same expectation. Years ago, you would send a wire payment and you would say, "Oh, good luck." It's at another bank, fire and forget, and hopefully it gets there and your person gets paid, and they'll tell you if they didn't. Well, now it's totally different. We want same visibility into this $50 million, if it's a $50 million payment across the network that you do with your own personal package that's coming.
(07:25):
And you're like, "We know the technology exists and it can get there." And that's on the payment side. And then also on the liquidity side, it's just as important to have this real-time understanding of what is my balance and how do I avoid having trap liquidity, especially when we're working across multiple regions. I don't want trap liquidity sitting in one region. I need to make payroll in Canada, but I have money sitting in Mexico. How do I manage that? And so the first step is let's make it transparent and make it real where you can see it. And then the second piece of this is how do we allow you to move money seamlessly across a footprint like North America? How can we connect US, Canada, Mexico, allowing a client to 24 by seven, 365 simply move money back and forth across their footprint, the me to me payments, the things that they're doing within their own organization.
(08:23):
We'd all love to be able to do this across a broad network and make all the payments globally 24 by seven, but there is a minimum a need to start with the transactions that the clients are doing for themselves to help them manage their liquidity more effectively. Those, we have to be able to support those in a much more robust and real time way.
Michael Moeser (08:45):
Now, John, I know we talked about Amazon. You mentioned Uber. I often think maybe one of the early efforts was the Domino's Pizza Tracker. I'm on the app, I ordered, I can see it's being prepared, whatever. And that's really sort of a one-on-one, me in the store, and that's a very simple analogy. But as we talked, a $1.4 trillion market complex environment from you've got agriculture, you've got mining, you've got all these different things going on and multiple clients. I've really would like to better understand what is Scotiabank investing in for the future to provide these capabilities? What have you folks recently released or planned to release in the near future as it relates to capabilities, infrastructure, et cetera, for this corridor?
John Hunter (09:39):
Yeah. So Scotiabank, we really view ourselves as a global transaction banking operation. We want to be able to support our clients across their entire footprint. So we've invested in consolidating our sales force and making sure we're more client-centric in those ways. We've centralized and managed product management. So we're beginning to think about our businesses, not siloed in country by country, but how we're thinking about things across the entire platform. And for example, we just recently released a brand new cash management program in the US. So this consists of a new DDA platform, a new wire system, a new ACH platform, a new portal for clients to come in. And the excitement of this is that we're going to uptier the US so it's similar to the strength we have in Canada and the strength we have in Mexico. So we can truly create a connected experience.
(10:40):
We've also focused and invested quite a bit in Scotia Connect. Scotia Connect is our digital banking portal, which now links the US, Canada, and Mexico together and allows a client to go in and see their position. So if you have an account in Canada and you have an account in the US, you can log in and you can see the balances in a global dashboard that you have sitting in these accounts and then you can transact off the back of it. But creating a connected experience is really the biggest thing we've been focused on. Also in the US, however, we realize that we need, along with our digital technology that we're implementing, like the US still uses paper, right? So we're going-
Michael Moeser (11:27):
Unfortunately, yes.
John Hunter (11:29):
It's true, right? And so if you're going to be someone's primary bank, you need to be able to do things like receivables via check, right? You need to be able to do lockbox. You'd be able to check outbound payables. So this paper investment is something we're focused on this year and adding to our portal and our platform to be able to allow clients to have a more holistic offering with Scotiabank and being able to have Scottia Bank really be their primary bank across a broad footprint. We're also investing heavily in liquidity management and ensuring that clients have the most efficient way of using the liquidity that they have to not only make money, but to make sure that it's in the place that they need it when they need it, and they have understanding around what their positions are and what their forecasts are, et cetera, for particular accounts that they own.
(12:22):
So we're thinking about this thing holistically where yes, we've built things in the US and they're new, but it's not for the sake of trying to be only a US bank. Where we think we have a unique value proposition is when we connect the markets.
Michael Moeser (12:40):
Almost like an interstate, wouldn't you say?
John Hunter (12:43):
Very much like for your- Highway.
(12:46):
That's right. Years ago, think about it. When you drove cross country where you went from little town to little town to little town to little town, right? And that's kind of the way that the networks have been working. You come into a region and you say, "Okay, who's the bank in this region? Okay, I'll bank with them and I'll bank with them." And so you end up with a key chain that has 17 different tokens on it for when you'd have to go each bank's portal. And it's very complex and you have to be able to understand where it all sits, but can we create a throughput, a way that they can move faster across the globe by connecting the network together and creating an overlay that allows them to see everything and have everything experienced. It can move much, much faster than it does today.
(13:35):
And this sharing of data and information is going to be key for our helping clients unlock their value across this network because today they have a very disconnected experience, right? They have a bank in Mexico, a bank in the US, a bank in Canada, maybe a bank in Latin America, a bank in the Caribbean, and now all of a sudden they're trying to make sure that a lot of their job is to ensure that they have visibility into what's happening in each one of these areas. Well, we can create a connected experience for them where they can see it all in one place. And we think that's massively differentiating in the market.
Michael Moeser (14:14):
Now, as governments, as banks, as corporations continually work to evolve their cross-border supply chains, and as payment flows evolve across Canada, the US, and Mexico, how is this reshaping the priorities and expectations of corporate treasurers?
John Hunter (14:36):
Yeah. Well, listen, five years ago or maybe 10 years ago, it was batch-based, it was siloed. It was, send me my end of day file and I'll come in the next morning and I'll reconcile the payments from yesterday because that's how I've done it for 30 years. That was just the way it worked. And now with the advent of new technology, with things like API connectivity and clients can begin to have real-time integration into their platforms, real-time reconciliation can begin to take place and there's a lot of value to be driven out of that. You don't have to wait for tomorrow to know that you had an issue with a payment or that it didn't go out. Now all of a sudden we can tell you immediately if your payment is stuck at another bank because we know it's coming and we haven't seen it yet and we can communicate those types of things.
(15:27):
So even these predictive analytics that AI are going to enable for us are going to be able to really change the way in which treasurers are going to operate. And the key is to have a bank that has an infrastructure that can support the evolution for your ... You don't know exactly what you need in two years, three years, to five years. I don't know exactly what that market's going to look like, but I need to have built an infrastructure and need my system sitting on capabilities that can ingest and can quickly ... Whatever's new and can quickly ... And I'll use the buzzword of agile way, deliver the solutions that you need and not be a, "I hear that you need that, it's going to be six months and $500,000 and let me rip open my mainframe and fix it. " That never works.
(16:30):
You have to bank with a bank that's going to have the right technology and right infrastructure in place. So when those future things come, you can be comfortable that you're future proofed because they're going to be able to offer and bring you the latest and greatest in whether it's AI or whether it's API or whether it's data solutions, whether it's even we go the route of a lot of different digital assets that are being talked about right now. We don't know how that's all going to play out, but you need a bank that has capabilities that will be able to support it for you and much of that is driven by infrastructure.
Michael Moeser (17:07):
So when banks invest in these modernization initiatives, APIs that you mentioned, data enriched payments, real-time payment rails, and real-time payment rails have certainly the number of them in the various countries has exploded in the last five, 10 years, and there's a real impetus for people to get on real time payment rails. What specific operational improvements do clients experience once they've invested in these modernization initiatives?
John Hunter (17:41):
Yeah, so it's not just faster. Faster is great and we want it to be faster, but we don't want fraud faster. We don't want other things. So faster is great, and we want faster settlement, and we want reduced friction through the lifecycle of our payments, and real-time rails deliver all that, but providing the data with it can create this whole kind of real-time enhanced decision-making. So when I can stop and I can outsource a payment and say, "Hey, is this a good payment or is it a challenging payment?" With this type of data, we can actually input into a value-added cycle for a customer thoughts and ideas that then they can make decisions on. So it's not just the settlement that's faster, which it's great if we have faster settlement, but it's also faster insights, faster understanding, the ability to move faster on a market opportunity that you may see and you may need your bank to help you with it.
(18:46):
So this is not just about driving speed, right? It's also- Well,
Michael Moeser (18:54):
Talk about ISO 2002 or 20022, if you will. I mean, your days from Swift as an example, I mean, it's a data enriched payment rail. What operational improvement could you delve into that?
John Hunter (19:12):
Yeah. So think about it. So the world has just invested in moving to ISO, and it's been a big expense for the banks, and they've all spent lots of money trying to get ISO compliant. But if all you are is ISO compliant, and if all you did was front end your systems with some router and you kept all your backend systems the same, you're going to lose the value that comes with ISO.
Michael Moeser (19:37):
And what is that value?
John Hunter (19:39):
So let's just take the addresses for the simplest example that you can think about. ISO now has a structured address format. So where before you would get a payment and it would say such and such street, Paris. And you'd be like, "Well, is that Paris, France? Is it Paris- Paris, Texas? Right. Florida, right? Which Paris is it? " You don't really know. And now all of a sudden it comes in a structured format and you can go, "Oh, this is Paris, France." And so you immediately, from an AML and sanctioned screening perspective, you have more enriched data that's going to make the simple. And maybe that payment would stop for something and we'd be like, "We can't tell.
(20:27):
Is this the good John Hunter or the bad John Hunter? We can't tell." And it would slow down the process. And now I can actually include data in the payment itself that can give me more information that can allow me to clear those types of false positives much faster. Those are two very basic things, but think about it from a fraud perspective as well, like more data, more information, and then you overlay on top of that structured format AI and the ability to say, "Hey, listen, I've never seen Michael make a payment to Turkey before." I've
Michael Moeser (21:06):
Made three.
John Hunter (21:07):
"Maybe that's something I should be concerned about and maybe that's something Michael should be concerned about and the ability for us to use these kind of real time data functions and apply analytics and AI to identify things that could potentially be fraudulent, that could be just different your baseline. We see this in the credit card space, right? You're sitting there and you use your card and all of a sudden you get a text message that says," Hey, we see you tried to use your card in France. "And you're like, " Yeah, I'm traveling in France. "But they didn't know. And so you have to go and tell them it's me.
(21:46):
But because that data's available real time, they can create those kinds of solutions. So I would look forward to the day where this is going to be the normal, where we have data enrichment, which provides data analytics, which provides insights to customers. "Hey, I see that you're buying Euro here and selling Euro there across your treasury footprint. Let us help you offset that and hedge that so you don't have to go through the expense of both of those things and your bank can use the data to make those things more efficient for you. " And so I think that's the future that we're heading to of this, not just doing things faster, but doing them faster with purpose that provide insight and information to make a treasurer's job simpler and easier.
Michael Moeser (22:35):
Well, now you mentioned sanction screening. You talked a little bit about fraud and AML and Michael making those transactions in a country he's never made. While modernization offers clear advantages, it also introduces complexities into areas, just as you mentioned, like sanction screening, data, privacy, fraud, AML. How do banks strike that right balance between innovation and operational resilience because you don't want all of a sudden now this ISO transaction's coming through that it doesn't slow down the ship, if you will. We need to keep moving forward. So how do banks strike that right balance?
John Hunter (23:16):
I think you have to bank with a bank that's built on trust, that's built their reputation. So Scotiabank, 190 years in the market, we are a bank that has built our reputation on trust and we are investing in your security and your safety. Safety and security is a big deal for us. So yes, we are going to move fast. Things are going to continue to increase. The pace that data moves across the networks are going to continue to hurry, but we're going to do so at a pace and at a cadence that is not going to put undue risk on a particular client. And so the data privacy, the fraud, the sanctions, all that has to move at pace with the technology. So we're investing in both. So we can invest, I talked about our investment in payment platforms and systems, but we had a similar investment in financial crimes and in fraud and in other things that allows us to kind of continue to provide that safety and security while we're also innovating.
(24:31):
And that's the way banks have to think about this. We can't just run fast on one corridor, one opportunity, one innovation, one thing. We have to bring the entire bank along with us. And so sometimes us banks get beat up a little bit for being a little slow, right? Maybe not as quick as a FinTech would respond. Well,
Michael Moeser (24:54):
You've got a lot of things to be concerned about. There's risk. There's compliance. You've got to do the sanction screening. So it's not an easy thing to tackle, especially when you want to try to be innovative.
John Hunter (25:07):
It's not, but that's the point is that you have to innovate at pace and you have to invest in those things at the same pace you're investing in innovation. So it can't just be about blockchain or whatever the next buzzword is. It also has to be about how do we create our safety and security to go along with that? It's great to have great products. It's great to have great service, but if you don't have safety and security, you're not going to be a bank for very long.
Michael Moeser (25:37):
No, no, no.
John Hunter (25:39):
That's how we strike the balance, right?
Michael Moeser (25:41):
Well, speaking of buzzwords, and I think you've mentioned AI already a couple times, I would be remiss in not asking you about AI because it's on everybody's mind these days. And AI is generating a significant amount of interest within the banking sector. As a leader, what do you see as the most practical and responsible application of AI for treasurers? What real use cases should they focus on?
John Hunter (26:06):
Sure. I think there's some kind of low hanging fruit that we see. Obviously, automated reconciliation, things anomaly detection. This whole idea of reducing a DSO and freeing up cash that we can get through doing those things faster. I think those are real and those are kind of low hanging fruit, but I think that there's a risk element as well. Things like, what is my exposure to a particular region? So let's say we're having an issue in a particular country years ago, there was a challenge in Greece, so what's my exposure to Greece and how do I know that? And now it was a lot of analytics and a lot of churning that happened through analysts on the side to come up with a daily dashboard that said, "Here's your exposure to Greek." Well, now with AI, we can hit a button and it can- Fantastic.
(27:08):
You know what I mean? Those are the capabilities that are available in the market. And then you think about it, take it to the next level. AI is not just about making or automating processes we already have. There's new capabilities, new enhancements, new things we can use AI for. One that I think is the big one that's actually happening in the market is this push to use AI to help in the development lifecycle.
Michael Moeser (27:42):
Got it.
John Hunter (27:43):
Actually developing and building code and getting 80% of your code in place by leveraging AI. And I think that there's a huge amount of efficiency that's going to be driven in the banking space when we get AI. So it's not just customer service, which is kind of the low hanging fruit. It's not just, how do I make sure that my anomalies or my issues? There's also this kind of core piece of spend that banks spend lots of money on technical development that can be made much, much more efficient as banks begin to embrace AI. And it doesn't mean AI is going to give us 100% perfect everything, but it's going to give us a leap frog. Can I get 40%? Can I get 50%? Can I get X amount percent of my code develop? So now I have a baseline and a starting place.
Michael Moeser (28:36):
It's the same way- A headstart, I would say. Almost a headstart.
John Hunter (28:38):
Yeah. It's the same way we see people using things like Copilot in email. You can have it draft your executive memo and is it perfect when it gets ... You want to tweak around the edges and add your own flavor and your own flare, but it can get you a good way of the way there. And I think that's also a way we need to think about AI. It doesn't have to be this end-to-end, this big thing that we go and we implement. It can be used also incrementally through the process to add value.
Michael Moeser (29:14):
John, is there anything specific that Scotiabank is doing in regards to AI right now?
John Hunter (29:20):
Yeah, we have a really cool partnership with EY, Microsoft, and Scotiabank, where we've prototyped a system that helps with data transformation around incoming wires. So when we have a wire that has an issue or when we have a wire that gets returned, we now can understand why and we can make transformation and analysis and reports of these issues much, much simpler. It was built in three months using Microsoft Copilot platform and we showcased it at a couple of the conferences. And it's been really cool to see how quickly we can stand up and develop things within that AI platform that can make a difference to the business.
Michael Moeser (30:04):
That's fantastic. That's very interesting. John, as we come to a close in this video, can you look into the future, gaze into your crystal ball, if you will, and tell us which advancements do you believe have the greatest impact on the efficiency and transparency of cross-border payments and liquidity management?
John Hunter (30:21):
Yeah, great question, Michael. Super excited about the future. There's going to be a lot that's happening. We're going to continue to see the expansion of real-time payment schemes across North America. And then the interconnectedness, how those networks connect themselves is going to be what's really important there. We're going to continue to see the growth and solutions around tokenized deposits and stablecoin. We're going to see these faster settlements and improved liquidity solutions evolve because with those solutions, you move to atomic settlement where the payment and the messaging go simultaneously and it reduces counterparty risks and actually speeds settlement to that transaction to the point where it makes it much more efficient for a bank to process. We're going to see embedded finance continue to grow. So how do we create interoperable platforms within our network that we could share and that we could help others embed into their services so they can get banking services to their customers as part of their commercial offering that banks are going to offer.
(31:27):
And then finally, there is going to continue to be innovation that sits around identification and trust. So things like biometrics, things like instant identify verification, it's going to continue to try to wrap a more secure overlay that sits around these high value transactions than today. And all of this, the beauty of all of this is that it's going to transform the way in which transactions happen. And that we at Scotiabank, we're so excited to be able to be part of this. And when we think about this most important corridor that we have in North America, our ability to connect that and to help move people into this future and that we're just super excited.
Michael Moeser (32:18):
That's a very exciting future. Well, folks, that's all the time we have for today. John, I want to thank you for your time and sharing your knowledge with us.
John Hunter (32:26):
Of course, my pleasure.
Michael Moeser (32:28):
And to our audience, thank you for listening in today. To learn more, please visit gtb.scotiabank.com. Thank you.
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