The ideal cross-border business payments experience

Cross-border payment innovation is a need, no longer a good-to-have

The market is not new when it comes to business payments innovation, but for the longest time, it has always been aimed at consumers. The revolutionisation of consumer payments has been driven primarily by the demand for better customer experiences. The acceleration of cross-border trade has further increased the focus on cross-border business payments. Banks are already catering to businesses looking to use new technologies to increase transparency, expand options and reduce costs associated with cross-border payments. Given the difficult environment banks and businesses are experiencing around the world, it is more important than ever to provide transparent, simple and efficient bespoke payment solutions.

As global businesses continue to grow, so too has the volume of cross-border payments. According to Visa's insights, more than hundred trillion in global business payments are processed annually, with at least 10 percent supporting cross-border commerce. With this growth, banks have to deal with these highly complex transactions. These transactions rely on relationships with correspondent banks and have limited insight into payment, cost, and security status. In the traditional payment process, the receiving bank has little ability to predict when the payment will be made or how much it will receive after calculating exchange rates and deducting various fees. Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations are also contributing to the demand for new approaches. Complying with local AML regulations can result in transaction delays, adding even more uncertainty to the current business environment, which is already full of uncertain processes and unpredictability.

Partnerships pave the way

As global businesses grow, opportunities to transform in a cross-border environment are increasing. Payment stakeholders are actually well-positioned to take advantage of the dynamic changes enabled by new technologies (one such example is SUNRATE's proprietary engine) that are driving further innovation in cross-border payments. The rise of cutting-edge solutions to re-engineer business cross-border payments will enable savvy stakeholders to meet evolving customer demands.

When making cross-border payments using traditional two-way correspondent methods, transparency is the main concern - as both the sending and receiving banks do not know where the funds for the transaction are located at any given point in time. Also, transactions are routed through multiple correspondent banks, making it virtually impossible to know when payments will arrive or what fees will be incurred. It is little wonder why stakeholders see payment transparency as the key to improving business cross-border payments. New digital innovations are emerging to meet this urgent need.

Global FinTechs like SUNRATE are contributing their digital expertise to create a more transparent ecosystem and to meet the challenges of business cross-border payments. Another benefit of such innovations is access to critical data. In the current model, much of the data associated with cross-border payments never reaches the final recipient. Without this information, bank customers struggle to coordinate payments efficiently. Solutions that ensure payments are accompanied by a full data stream throughout their lifecycle can begin to meet the much-needed goal of direct reconciliation.

More choices is a good thing

When it comes to business cross-border payments, banks and their customers see increased choices in the market as a very positive development - it is clear that there is room for more options.

Innovative new solutions such as those provided by SUNRATE enable efficient cross-border payments through multilateral relationship structures. This type of structure overcomes the limitations of traditional bilateral approaches that rely solely on correspondent networks. Emerging networks leverage next-generation technologies, such as SUNRATE's proprietary engine that can facilitate financial transactions on a private, permissioned, and highly secure network. This is why SUNRATE is partnering with the top global banks such as Citibank, Standard Chartered and DBS to provide such virtual accounts for our customers. An increasing number of innovative technology-based options promise to democratise the way cross-border payments are made. Ultimately, of course, it is all about empowering businesses, big and small, to help them do more, even during difficult times.

Conclusion

Innovative solutions are emerging to reinvent the way cross-border business payments are made. These evolving solutions (such as those provided by SUNRATE) offer important benefits for banks and their customers. More choices, more transparency, more predictability, better compliance, better access to critical data, and more. Another key advantage of adopting (our) cutting edge cross-border payment solutions is still cost savings, as the costs of managing intermediary banking relationships are eliminated.

A centralised and permissive network where all participants are known participants allows payments to be processed securely and directly, minimising cost. With continuous market-driven innovation and new technologies, the future of business cross-border payments promises to be simpler, safer, cheaper and more transparent. Geographic barriers are slowly being removed in this rapidly evolving global payments ecosystem. Banks can be expected to work with FinTechs and other innovative players to introduce new technologies into the space while leveraging their expertise as digital natives to enhance customer relationships. Business cross-border payments are in the process of being revolutionised - this is ideal for the entire ecosystem.

Partner with SUNRATE on your cross-border business payment journey

SUNRATE is an intelligent global payment and treasury management platform for businesses worldwide. Since its inception in 2016, SUNRATE is recognised as a leading solution provider and has enabled companies to operate and scale both locally and globally in 150+ countries and regions with its cutting-edge proprietary platform, extensive global network, and robust APIs.

With its global headquarters in Singapore and offices in Hong Kong, Jakarta, London and Shanghai, SUNRATE partners with the top global financial institutions, such as Citibank, Standard Chartered, Barclays and is the principal member of both Mastercard and Visa.