Six years after the Group of 20 (G20) introduced an ambitious roadmap to address long-standing inefficiencies in cross-border payments, global regulators say progress has been made—but many of the most persistent problems remain unsolved. In a recent keynote address, Financial Stability Board (FSB) chair Andrew Bailey assessed how far the effort has come and where it still falls short.
Speaking at the FSB Payments Summit, Bailey pointed to the increased adoption of international standards as one of the most significant developments in recent years. These advances include the implementation of the ISO 20022 messaging protocol, expanded operating hours of financial institutions to better accommodate international payments, and stronger anti-money laundering and counter-terrorism financing standards.
Despite these achievements, there has been little improvement in the end-user experience. Delays, high fees, and lack of transparency in cross-border payments are still as prevalent today as they were decades ago.
Left unchecked, Bailey warned, these persistent frictions could erode the stability of the global financial system and ultimately stymy economic growth.
Unforeseen Developments
Bailey also reiterated FSB guidance from last year indicating that G20 countries are unlikely to meet the cross-border payment efficiency targets set for 2027. While uneven implementation of standards across member nations is partly to blame, a number of unforeseen developments have also complicated progress since the roadmap was created.
Technologies such as artificial intelligence, cloud computing, and digital assets are rapidly reshaping expectations for financial services firms. At the same time, fraud has become far more sophisticated—driven in part by these same technologies—posing a growing threat across payment channels, especially in cross-border payments.
The Four-Part Plan
To combat these issues, Bailey outlined a four-part plan. First, public-sector entities should create local action plans to ensure international recommendations are effectively implemented at the domestic level. Second, they should prioritize innovation and modernize infrastructure to better support cross-border payments.
Third, Bailey called on member nations to reduce regulatory compliance costs, noting that the FSB has identified numerous cases in which regulatory hurdles have slowed cross-border payments. Finally, he emphasized that greater participation from the private sector will be key to reshaping international transactions.
Calls for a consortium-based approach have grown more common as the financial services industry confronts complex challenges, including fraud. In the context of cross-border payments, Bailey noted that deeper collaboration between public and private stakeholders will be essential to ensure regulators focus on the most pressing issues and take effective action.
