Sibos 2024: Significant News, Agreements, and Unveilings
Cross-Border Payments: A Growing and Evolving Market
The world of cross-border payments is experiencing rapid growth and transformation, with numerous players launching innovative solutions to address the challenges and opportunities in this massive market.
This week, the Sibos conference took place in China for the first time, providing a platform for several significant announcements. Mastercard launched Mastercard Move Commercial Payments, a new product designed to facilitate near real-time payments 24/7 for banking clients, aiming to address key pain points in handling corporate payments.
HSBC also announced two solutions to help banks enable merchants to easily receive EUR and GBP payments to local bank accounts, and to support foreign parties investing in China's financial system.
TerraPay, in collaboration with Tenpay Global, is enabling international transfers to one billion Weixin and WeChat users in China, further expanding the reach of cross-border payments. The People's Bank of China has expressed its intention to continue collaborating and fostering interoperability with global institutions.
In the realm of fintech, Swiss banking software provider Temenos launched a new software-as-a-service solution for cross-border payments. This solution is designed to help fintechs quickly launch low-cost remittance services, contributing to the growing trend of digital payments.
The cross-border payments market is immense, with global flows exceeding $150 trillion in 2022. The market is projected to grow robustly, particularly in ecommerce and emerging markets. According to reports launched by EY and Citi, the cross-border consumer-to-business (C2B) payment segment is expected to grow at an 11% compound annual growth rate (CAGR) from 2023 to 2030.
However, challenges remain in the cross-border payments market, particularly around costs and speed, especially for SMEs and retail remittances. Average cross-border B2B payment fees range from 1–3% for large corporations and can exceed 5% for SMEs using correspondent banking networks. Remittance costs globally averaged 6.2% in 2023 for sending $200, substantially above the UN Sustainable Development Goal target of 3%.
Real-time payment infrastructure is expanding, with examples such as India’s UPI linking with Singapore’s PayNow since 2023 to enable instant low-cost cross-border transfers. Stablecoins and digital assets are emerging in the cross-border payments ecosystem, currently accounting for less than 1% of the market but with significant total addressable market potential.
For further in-depth and up-to-date data on the cross-border payments market, consulting industry research portals like Mordor Intelligence can offer comprehensive market research reports that include competitive landscape, technology trends, regional analyses, and forecasts.
Thunes is rolling out a QR code solution to help foreign travelers make payments to vendors across China, adding to the growing trend of digital payments in the country.
In summary, the cross-border payments market is massive, growing robustly, and undergoing significant transformation through real-time payment infrastructure, stablecoins, and AI-driven solutions. Key challenges remain around costs and speed, particularly for SMEs and retail remittances.
- The growth and evolution of the cross-border payments market is also reflected in the business sector, as seen with Mastercard's launch of Mastercard Move Commercial Payments, aimed at facilitating near real-time payments for banking clients, and Temenos' introduction of a software-as-a-service solution for cross-border payments designed to help fintechs launch low-cost remittance services.
- In the realm of technology, stablecoins and digital assets are becoming increasingly prevalent in cross-border payments, showing significant total addressable market potential and accounting for less than 1% of the market currently.
