In a significant move to rival industry frontrunners such as SAP Concur, Expensify, and Egencia, Citi, and Navan have announced the launch of a co-branded travel booking and expense management technology on Thursday. This AI-powered solution, called Navan Connect, is designed for Citi Commercial Bank cardholders in the U.S.
Navan, an expense management startup, has secured an exclusive agreement with Citi for this joint venture. This strategic partnership is expected to considerably expand Navan’s market presence, given Citi’s status as the third-largest US bank. According to InvestingPro data, Citi has a market cap of $77.93 billion and oversees more than 25,000 global commercial card programs and has 7 million cardholders who collectively account for over $42 billion in annual charge volume in the U.S.
The new service eliminates the need for traveling employees to file expense reports while ensuring streamlined transaction reconciliation for corporate finance departments. Michael Sindicich, executive vice president of GM Navan Expense, expressed that this alliance would broaden their potential customer base. Citi’s commercial clients now have the option to join Navan Connect, thereby integrating their accounts with Navan’s software and abolishing the procedure for filing expense reports for travel or miscellaneous costs.
While Navan does have its own corporate card offering, it sees immense value in merging its technology with financial institutions and does not view its Connect product as competition. The company’s revenue model hinges on subscription license fees for its expense management software and trip fees.
This partnership is a significant victory for Navan due to Citi’s extensive customer base of over 25,000 commercial card clients and 7 million cardholders globally. Ariel Cohen, Navan’s CEO, confirmed that this collaboration validates their technology’s ability to provide real-time visibility and control over spending—a topic he previously discussed at the Skift Global Forum.
InvestingPro Tips suggest that Citi, despite being a prominent player in the Banks industry, has been experiencing a declining trend in earnings per share and is trading near its 52-week low. Yet, it has maintained dividend payments for 13 consecutive years, indicating a level of stability amidst these challenges. For a more comprehensive analysis and additional tips, readers can visit InvestingPro.
Citi’s P/E ratio stands at 6.34, indicating a low earnings multiple, and its revenue growth for FY2023.Q3 is reported at 6.9%, according to InvestingPro data. Despite the challenges, analysts predict the company will be profitable this year, making it a notable player in the ongoing digital transformation in the banking industry.
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