Are you aware that there are cross-border transactions that are instant payments? Though these kinds of payment transactions are fast gaining traction, the adoption is slow in the banking industry. Cross-border payments are made frequently as it is a requirement of our global economy.
A connected market
Cross-border payments are what keeps the global economy moving. It is more widely used nowadays than ever before as we have a connected market. It is no longer difficult nor does it take a lot of time to have products like cell phones shipped from companies in other countries.
There are many who hire employees from far away countries. These companies have a virtual team that does tasks for them. It is easy to find employees that accept payments online who do tasks like web development and other IT related work that does not require them to report to an office.
Transact in the global arena
There are several corporations that do need to make international payments quickly. Traditionally, those cross-border payments through banking institutions have been both expensive and slow. The time lag does create inefficiencies and adds to the costs of corporations that transact in the global arena.
The time lag of sending through traditional banks is not a few hours but can extend to days. Another problem that is commonly encountered is that when the bank is closed, such as during holidays and weekends, the incoming funds will not get reflected in the balance. For the global economy, those long days of waiting are much to slow, so many corporations have switched to alternative methods of payment.
Alternative methods of payment
Alternative methods of payment include that of using quick money transfers through agents. There are also person-to-person (P2P) apps that provide instant remittance. These methods only take minutes to be completed, unlike the traditional international bank-to-bank transfer that can take several days.
The obvious solution is to have instant payments for cross-border transactions. The advanced payment solutions of digital money transfers do provide this option while traditional banking institutions still lag behind. In September 2019, there was a transaction banking survey conducted by CGI. The survey results showed that the corporate clients’ satisfaction with the banking services had declined to less than fifty percent when compared to the results seven years ago.
Demand for digital services
The consumer demand is reflected by the lowering of the satisfaction that corporations have for their banks. The corporations want digital services and products which are essential to them. Only eight percent of banking institutions can fill their demands.
Spurring the growth of the global economy
The changes in economic trends, migration, and international commerce spur the growth of cross-border payments even further. Remittance companies and online financial services have experienced a remarkable increase in their profits.
Advanced payment solutions
Money transfer services do offer much lower fees and faster transactions than traditional banking institutions. The trillion-dollar industry of cross-border payments is tapped, bringing about the rise of more remittance companies that provide advanced payment solutions.