In the modern age, global economics is so closely interlinked with local economics that one cannot do without the other. Business is happening across the globe, amongst various countries. Over the ages, the process has undergone a lot of refinement and it now stands digitized.
CROSS BORDER PAYMENTS – AN INTRODUCTION
In simple words, cross-border payments are those payments involved in the transaction where the buyer and seller are in different counties. These transactions can be between individuals, companies, or banks. These aid in international trade and boost the economy on all fronts.
- A VISIBLE SHIFT
The growth of cross-border payments is slowly but definitely shifting from trade to e-commerce, thanks to the profound growth of e-commerce industries.
- CUSTOMER IS KING
The providers no longer rule the market. It is the customer who decides the nature of service.
- INTEGRATION OF SOLUTIONS
Though the value chain shall remain fragmented, there will be an integration of the product for the end-user. He will not be able to see the differences in production
- SINGLE PAYMENT AREA – UNLIKELY
Though a single payment area globally is desired by many, the geopolitics involved makes this scenario highly unlikely
- DIFFERENT PAYMENT SOLUTIONS
Different payment solutions and methods continue to emerge. The focus may shift from standard payment methods to creating connections between various payment solutions and infrastructures.
- LEVEL PLAYING FIELD
The regulators are more focused on customers for now and are not so keen on concentrating on the competition. A level playing field still remains elusive.
- International Wire Transfers
- International ACH
- Prepaid Debit Cards
- Paper Checks
Soon, retailers and SMEs will start using cross-border payment services on a large scale. In today’s environment, the following imperative for success:
- A need to understand the future revenue models
- Clients propositions need to be revisited
- The engine room needs to be updated and upgraded
- Collaborative solutions need to be explored
- A partnership ecosystem needs to be established
- Value chain should have clearer roles
A few of the cross-border payments companies include OFX, Payoneer, Aurelia Pay, Money Corp, Currencies Direct, World Remit, Transfer Go, SWIFT, Cashfree and payment wall amongst others.
Cross border payments, along with innovation and customer demands are here to stay. The opportunities should be harnessed in a healthy way keeping the pitfalls in mind.