Chad Wallace, executive vice president, Global Transaction Banking at Scotiabank, offers his insights on the digital transformation sweeping transaction banking and the strategies required to thrive amid rapid disruption.
Global Finance: Your career has included service at Mastercard, Goldman Sachs, and Capital One. What are the biggest shifts you’ve witnessed in transaction banking?
Chad Wallace: Over the past decade, the most significant shift I’ve observed in transaction banking is how it has evolved into a central pillar of a bank’s overall strategy and growth.
I think back to my time at Capital One, and the biggest point of progress was moving our client infrastructure to the cloud. This was a massive project in 2015. We were also trying to build our own capabilities in the commercial bank. A key part of my growth was learning how to work hand‑in‑hand with engineers to shape and deliver products.
When I started there, I knew nothing about corporate banking, having only worked in consumer banking previously. It was a pivotal moment in my career to understand product management and development in this context, working with engineers and building with clients. This became my source of differentiation compared to other product leaders in the Commercial Bank—ultimately that’s what created a path for me for many new career opportunities.
Fast forward to Goldman Sachs, where we had the idea of creating a transaction banking business from scratch: something that had not been done in over 30 years. We built a platform [TxB] that allowed our clients to manage their treasury, starting in the US, and later expanding into the UK and Europe. We essentially created a fintech, within a 150-year-old organization.
At Scotiabank, over the past year, we’ve been deliberately investing in modernizing our transaction banking capabilities across our international footprint; focusing on scalability, connectivity, and disciplined execution. The objective is to make it easier for clients to manage liquidity, payments, and trade across markets, while maintaining strong governance and resilience.
Overall, transaction banking has shifted from being a supporting actor at the bank to being a main character; a core driver of growth and innovation, which is reflected in the investments we continue to make at Scotiabank.
GF: How has the perception and status of transaction banking professionals changed in the industry over the last decade?
Wallace: Transaction banking professionals had always been relegated to the back office, managing payments. If something went wrong, they were blamed, but if it went right, nobody cared. Now, it’s completely different. Today, transaction banking sits at the intersection of client strategy, technology, risk management, and growth, and that shift has accelerated meaningfully over the last decade.
From a Scotiabank perspective, what we’re seeing now is transaction banking recognized as a core driver of client primacy and sustainable earnings, not just an execution function. The reason is simple: payments, liquidity, trade, and cash management are where clients feel the bank every single day. When those capabilities are modern, reliable, and well‑integrated, they become strategic, not just operational.
If we talk about the massive pivot of the transaction banking “brand” and skill set in the workforce, it has radically changed in the last five to 10 years: from the forgotten team to the forefront of innovation and importance at the CEO table and in board discussions.
Earlier in my career, I was involved in building an embedded finance capability. This involved exposing a set of APIs, allowing technology clients to build on top of them. I was part of the early design discussions for a model where a licensed technology platform could leverage our capabilities to offer accounts, wallets, and other financial services they had not previously been able to provide, and to do so in a compliant way. We spent a lot of time understanding compliance. I see other companies have followed suit. Some survived and some didn’t, depending on the regulatory environment and their ability to comply.
Now, we’re seeing more and more investment happening in the transaction banking business, and it’s becoming vital to future growth. This is also why there’s so much innovation in the payments ecosystem, with concepts like stablecoin and tokenized deposits. These were not conversations we had 10 years ago. It’s fascinating how fast things are moving in this space and the willingness of CEOs and boards to invest to ensure we have the right products and technology in place.
GF: What are the pros and cons of stablecoins and other digital currencies?
Wallace: The distinction between a stablecoin and tokenized deposit is critical. Tokenized deposits are overnight deposits that can be programmed for movement and programmed triggers, making them more flexible and nimbler than traditional fiat currency. A key difference is that tokenized deposits are integrated into liquidity and funding structures, enhanced by modern technology.
Stablecoins, on the other hand, are often US Treasury-backed. Tokenized deposits are essentially the use of blockchain technology for existing overnight deposits, managed by banks and in some cases backed by FDIC insurance. Banks are focusing on tokenized deposits but also recognize the need to accommodate clients who use, hold, or send stablecoins.
GF: JPMorgan Chase CEO Jamie Dimon recently clashed with Coinbase CEO Brian Armstrong as to whether crypto exchanges should be able to pay recurring fees on stablecoin deposits. What are your thoughts?
Wallace: Generally speaking, we are supportive of a level playing field for all players in the ecosystem. Considering the models in various countries launching tokenized assets, and the rules around them, I believe tokenized assets will increasingly be used by the banks in order to maintain liquidity.
Certain aspects of currency should be managed appropriately, and fintechs need to be supervised according to the specific risk of their business, but I am a big advocate for competition and innovation. Encouraging both will lead to better products and ideas across the board. Banks, fintechs, and technology companies must be ready for this shift.
GF: How do you provide a truly integrated banking experience across the Americas?
Wallace: Our primary task is to globalize our product offering, specifically to provide our multinational corporate clients with a consolidated, globalized offer. This will create a connected footprint, enabling them to transact more effectively.
We are building technology components, specifically cloudbased, real-time capabilities, to advance the bank’s operations. This includes the ability to move data and money seamlessly across different corridors.
Additionally, we are actively integrating with major ERP systems, accounting systems, and treasury workstations. Ultimately, we aim to operate a bank that is fully interconnected with these platforms, eliminating the need for clients to log into a separate bank portal. The goal is a “consumer-grade experience” where a CFO can manage payables and receivables within their system without ever logging into a bank portal.
I believe embedded finance is core to the future of banking: being where the client is. For a CFO using their ERP application, we want to be integrated within that application, allowing them to manage both payment and data flows seamlessly.
We have a significant roadmap already launched with SAP and Oracle, as well as others. Many of these applications are SaaS-based, which allows for rapid implementation of bank connectivity. Instead of a complex project to connect, integration is often as simple as clicking a button for instantaneous set-up. This is how we are achieving significant scale.
GF: What is Scotiabank’s strategic focus regarding the utilization of AI?
Wallace: Scotiabank has used AI for years in fraud detection, and now for client insight reports, to give clients recommendations and a monthly overview of where they can improve their payment flows. More broadly across the Bank, AI is being embedded in both client facing and internal processes to improve experiences and support better, faster decision making.
While we are actively investigating agentic AI capabilities for tasks like optimizing liquidity, our immediate focus is on embedding technology that drives revenue-generating opportunities and enhancing the client experience and is deployed within a strong governance and risk framework.
