This article is posted in The Paypers and penned by a senior at Nium, the Singapore-based fintech specializing in cross-border money movement. The author provides an overview of steps that corporates can take to improve the overall funds transfer experience. Many of these things we have covered in these pages (in various use cases as well) and also in member research, therefore some readers will be familiar with certain ‘best practices’ in this age of multiple cross-border innovations now available for adoption. Until just a couple of years ago, most of these tech advancements in x-border were on the remittance (P2P) side, and to some extent in payroll disbursements (keeping up with gig economy trends). Now these advancements are extending into B2B use cases, which have generally been dominated by traditional correspondent banking models.
‘Over the last ten years, the industry has made great progress in terms of cross-border payments, especially at the B2C and C2C level, yet the B2B segment has lagged behind, due to several issues that regard legacy systems and a struggle to keep up with a changing regulatory environment…
For example, there is still a high reliance on manual processes, a lack of interoperability between platforms, and to complicate matters further, different regulations distract businesses from other projects that could bring a lot of profit. These issues could lead innovation to become a pursuit of minimum viable products and a failure to grasp substantial opportunities.’
The author goes on to point out various things that are contributing to the improvements in cross-border delivery, not the least of which is the ongoing testing of real-time cross-border transfers between sovereign instant payments systems, which has been a trend for the past two years. Certainly one of the hurdles to overcome in adding multiple trading or business relationship counterparts across various foreign markets is the need to comply with local regulatory requirements in terms of accounts, data, and last mile delivery. This is a key issue and one way that savvy fintechs can overcome such concerns on behalf of corporates. A dynamic space that keeps on evolving.
‘Our goal is to overcome inertia in B2B payments. The era of checks and faxing purchase orders has long passed, and one of the best practices would be to actually be aware of the digital evolution and check carefully to see what you’re missing out on a competitive edge, how you can get money faster, how you can ease the payment processes for your customers. For this reason, we bring the embedded finance mindset into play…
It is also important to select the right payment provider, one that focuses on scalability, with an enriched API suite so that your payments can be on the right platform at the right time. Nium has a global presence, enabling payins, payouts, card issuing, and many other services, all at a global scale.’
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group