Real-time cross-border payments are gaining significant momentum as global consumers increasingly rely on them for seamless transactions, according to a recent research study.
Many consumers depend on them to send funds close ones, while others use them to purchase goods, underscoring their importance in the global digital economy.
In spite of the significant progress, obstacles still persist in achieving G20 targets for speed and efficiency across major markets, explains GlobalData, a data and analytics company.
GlobalData’s 2024 Financial Services Consumer Survey reveals that around 63% of global consumers use international real-time payments services to send money to family and friends and 51% use them only to pay for goods and services.
GlobalData’s upcoming virtual conference, “eCommerce in Financial Services,” brings together expert insight and gold-standard data from GlobalData’s Banking & Payments and Strategic Intelligence products to explore what the future of eCommerce and financial services might look like.
It will explore impactful developments—embedded finance, cybersecurity, and cross-border payments—to discover how these are impacting transactions in the modern world.
According to GlobalData’s Payment Instrument Analytics, the overall volume of cross-border transactions across Europe alone should increase by nearly 60% between 2023 and 2028.
The G20 roadmap for cross-border payments aims to boost the overall speed, access, transparency, as well as cost of carrying out international payments by the year 2030.
In its most recent update in October 2023, the Financial Stability Board reported a shortfall against G20 targets in the proportion of retail services that make funds available to the consumers in “an hour (42% vs target of 75%) and in one business day (76% vs target of 100%).”
Stephen Walker, Lead Banking and Payments Analyst at GlobalData, shared that not only are real-time payments considered more preferrable to traditional methods because of their speed, but these services also tend to be “available 24/7, reduce transaction costs, and ease liquidity management for businesses.”
Walker pointed out that they also represent the next a step for cross-border payment services.
This, as the overall volume of cross-border transactions also ramps in the coming years.
Several global initiatives, namely the “Immediate Cross-Border Payments” developed by The Clearing House in the US, EBA Clearing in Europe, and SWIFT, are being developed to establish a 24/7 USD-EUR payments corridor in an effort to enhance cross-border payments.
Walker also mentioned that as these developments and initiatives continue, the tradeoff between the ease of creating “multilateral channels” and the “scalability” of a global system will get more challenging to overcome.
Walker also shared that the failure of pan-Nordic initiative P27 illustrates the challenge of collaborating on and executing the vision of “a cross-border settlement scheme across jurisdictions.”
Walker added that the push for digitalization of consumer payment methods will be considered vital in further lowering costs and enhancing transfer speeds.
Walker further explained that simplicity and “speed” of the transfer process is considered to be the most important factors for consumers when selecting a reliable cross-border payment provider.
They added that although progress has been “tangible,” there is scope to improve these measures and “reap the rewards from delivering these services.”
As clarified in the update, GlobalData’s 2024 Financial Services Consumer Survey had been carried out in Q2 2024 and reportedly had 61,000 respondents across 41 different nations.
