The widespread and explosive growth of the internet has resulted in many businesses, even large-scale organisations to move their businesses to a completely online business model. Most, if not all of these organisations, have developed their own cross-border payment solutions to facilitate and speed up financial transactions.

Cross-border payments are financial transactions that involve the transfer and transactions of money between individuals and/or organisations based in different countries. These transactions are carried out via financial institutions and corresponding banking networks (CBN) that are involved in money transfers in each country.

When online/cross-border payments over the internet started, it was looked down with a lot of skepticism. It was labelled slow, complex, and inherently risky. But today, with highly secure internet technologies like SSL, banking and related financial transactions, including real-time cross-border payments, have become as normal as giving cash physically to an individual.

Types of Cross-Border Payments:

Cross-border payments over the internet can be of many types such as –

● Credit Card Payments

● Alternative Payment Methods (APMs)

● International Wire Transfers

● International Automated Clearing House (ACHs)

● Prepaid Debit Cards

● Paypal

Advantages of Cross-border Payments:

Today’s population is globally aware, technologically advanced, and mobile, thus necessitating real-time cross-border payments more than ever before. Cross-border payments have the following benefits –

✔ Minimal money transfer fees

✔ No hidden fees in currency exchange rates – hidden fees for money transfer services are usually eliminated, as one country’s currency is directly valued concerning another country’s currency

✔ Faster and simpler movement of money

✔ Payments across borders now take only a couple of minutes instead of days/weeks earlier

✔ You only need a device connected to the internet to transfer funds across the planet

New Trends Redefining Cross-border Payments:

The worldwide cross-border payments system keeps evolving and changing rapidly to become more secure and simpler, with funds being transferred instantly in just one or two clicks!!

1)     Rapidly changing vonsumer demands – Core banking services very soon are expected to become blazing fast, with 5G Networks becoming more globally prevalent in the coming months. In addition, the advancement of mobile technologies, always-connected devices like smartphones, tablets, ultra-portables, etc., have elevated cross-border payments to a whole new level.

2)     Cheaper money transfers – As newer and more advanced FinTech companies like Tazapay and other similar start-ups launch easier solutions for real-time cross-border payments, the services correspondingly become cheaper and more financially affordable to the wider population.

3) Trading with wider and more diverse markets becomes possible.

4) The global prevalence of smartphones and always-connected devices.

5) The ever-growing range of payment service providers.

The Future of Cross-border Payments:

From what we all are witnessing now, it is obvious that the demand for cross-border payments will only increase exponentially in the coming times. This is especially relevant in the current pandemic period when everyone is being urged to stay at home, and all services are either being moved online or are already online.