When the G20 set out its plan for improving cross-border payments, it framed the challenge around four goals. Transfers, the G20 said, should be faster, cheaper, more transparent, and more inclusive.
For many banks, these goals looked a lot like another set of compliance demands: new standards to absorb, new technologies to evaluate, and more regulatory milestones to meet.
But the G20’s priorities also reflect what customers have wanted for years. Whether it’s a family sending money home, a freelancer being paid for work abroad, or a small business sourcing from another market, the expectation is that payments should mirror how people actually work and live.
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Meeting those expectations is becoming existential for banks. Institutions that adapt to how people now move money will remain relevant in the parts of the economy expanding fastest: digital payments, remittances, and cross-border commerce that takes place daily, not occasionally.
The economic case for faster payments
Cross-border payments form part of the infrastructure that keeps economies moving. When payments move efficiently, trade and investment follow. Smoother settlement lowers the cost of doing business and encourages more cross-border exchange.
In developing economies, this efficiency can be transformative. The World Bank estimates that remittances to low- and middle-income countries reached $656 billion in 2023 – flows that, in some nations, exceed foreign direct investment. Even small reductions in cost or delays have a measurable impact: more money reaching families on time means more stability, more consumption, and more opportunity to save or reinvest.
Financial inclusion is the longer-term outcome – and the real dividend of getting payments right. When cross-border transactions are secure and affordable, individuals and small enterprises gain access to formal finance, building credit histories and taking part more fully in the global economy.
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By GlobalDataA market in transition
Cross-border payments have already become a daily habit for billions of people. Data from TerraPay and PYMNTS Intelligence shows that 70% of consumers typically engage in cross-border transactions through remittances, and 77% of businesses generally engage in B2B cross-border transactions with suppliers. The same research shows just over four in ten consumers said a digital wallet is their most preferred method for sending or receiving cross-border payments.
With more than five billion mobile wallet users worldwide, the future of cross-border payments lies not in wholesale transfers but in the vast flow of smaller retail and low value transactions that fuel travel, e-commerce, gig work, and remittances. FTX Intelligence estimates that retail cross-border payment flows are forecast to reach $64.5 trillion by 2032.
The growth outlook also reinforces where the value and opportunity lie. FXC Intelligence forecasts particularly strong growth in categories that map to everyday, lower-value payments: consumer-to business (C2B) cross-border payments (including travel and e-commerce) are forecast to rise from $4.5 trillion in 2024 to $7.1 trillion in 2032, while business-to-consumer (B2C) cross-border payments (including paying international workers and gig-economy payouts) are forecast to grow from $1.9 trillion to $4.4 trillion over the same period. These are precisely the flows that place pressure on speed, transparency, and settlement certainty, because the payment experience is part of the product experience.
Why banks are lagging
Banks have long understood the importance of cross-border flows, but not all cross-border systems are built the same way – and that creates opportunity for adoption and improved efficiencies. Traditional infrastructure is optimised for large, wholesale transfers between institutions, not for millions of low-value transactions that need to clear and be settled instantly.
Technology alone isn’t the problem. Banks must contend with compliance and regulation requirements that continually change but are an essential requirement for day-to-day operation. Few banks have the resources to build interoperable connections from scratch. The more practical solution is partnership: linking into networks that already connect wallets, fintechs, and other payment providers. Through shared infrastructure and connectivity, banks can expand their reach without rewriting their technology stack.
From compliance to commercial strategy
If the G20 goals are interpreted narrowly, they look like a regulatory hurdle. Seen strategically, they’re a commercial opportunity. The segment growing fastest in both volume and innovation is low-value retail payments, driven by digital commerce, remittances, and the mainstreaming of mobile wallets. Banks are actively exploring business use cases for wallets, including how wallets can also support B2C flows such as refunds processed on a 24/7 basis, improving the customer experience.
This growth isn’t confined to consumers. Corporate buyers increasingly expect the same immediacy and transparency in B2B payments that they experience in personal finance.
This shows how expectations that begin in retail can reshape business transactions, dissolving the old boundary between the two.
The banks that respond to this reordering of payments will find themselves at the centre of the new transaction economy – one that values accessibility, scale, and speed over legacy concerns around size or prestige.
Interoperability can bring this vision to life. When banks, wallets, and payment systems can exchange value seamlessly, geography stops being a constraint. A health worker in Dubai sending $100 to the Philippines or a small business in the US paying a supplier in China, now expects the same speed and certainty as a domestic transfer.
This challenge is not new. Telecom networks similarly learned that once messages could travel between carriers, communication became universal. Payments are reaching that same stage. Safe, instant movement of value across networks will become a defining feature of modern finance.
What comes next?
The global payments system is being rebuilt from the edges inward. What might once have been dismissed as a multitude of small, low-value transfers now reveals – and shapes – the future of the world’s financial infrastructure. The real progress will come not from any single technology or policy, but from the quiet work of connecting systems so that value can move as easily as information.
As those connections deepen, the distinctions between domestic and international finance will continue to fade – and with them the barriers that have long limited who can fully take part in the global economy.
David Backshall, VP Partnerships, TerraPay
