Preparing for cross-border payments
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Preparing for cross-border payments

Ai Editorial

5th November, 2022

Travel merchants acknowledge that the last couple of years have resulted in certain lessons when it comes to global payments.

There are challenges that need to be handled better. Aspects include managing payment fees, currency exchange rates, long payment rails, compliance checks (tends to be a complex process because of which the same transaction may need to be checked several times, banks may use different sources for conducting their checks which can lead to payments being incorrectly flagged etc.), data formats (data standards and formats vary significantly across jurisdictions, systems and message networks) etc.

Overall, merchants are looking at ways to transform the way they send and receive payments, and to make cross-border payments faster, cheaper, more transparent, and easier to implement. “It all comes down to automation, more control, and insights,” said TerraPay’s Koert Grasveld.

Global payments include retail payments (between individuals and businesses), wholesale payments (generally feature financial institutions), B2C, and B2B payments. Cross-border payments trail national/ local payments in terms of cost, swiftness and clarity.

According to the Bank of England, the value of cross-border payments is estimated to increase from $150 trillion in 2017 to over $250 trillion by 2027, equating to a rise of over $100 trillion in just 10 years. Explaining the drivers behind this surge, Worldline’s Marc Docherty said consumers are on lookout for speed and efficiency paired with low-cost, digitally intuitive services and digital device ownership offering easy access to online banking services and e-payment solutions.

As Grasveld points out, for cross-border payments, the requisite infrastructure should pave way for features that automatically choose the best banking network to reduce delays, saving money on payment fees and currency exchange rates, apt compliance checks, automating tasks like reconciliation report verifications or settlement balancing and letting recipients opt for the fastest and cheapest payment method.

How can airlines and travel merchants prepare themselves better for global payments?

Hear from senior industry executives at the upcoming #ATPS in London, UK (14-15 March, 2023):

https://www.aiconnects.us/atps-2023/

By Ritesh Gupta, Ai Events

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