In today’s hyper-connected economy, sending and receiving cross-border payments is always necessary.
In the USD156 trillion cross-border payment market, the B2B segment accounted for USD37 trillion. That’s a lot, thanks to the e-commerce surge and digital payments.
These businesses and financial institutions rely on fintech companies like Tranglo to develop solutions and work behind the scene to connect their B2B cross-border payments.
What is cross-border payment?
It refers to any transaction between the payer and the recipient in different countries.
It can be a transaction between banks, financial institutions, businesses or individuals, covering wholesale and retail payments, including remittances.
Example: Joanne from Malaysia bought a pair of shoes from an online reseller based in Singapore, who sourced the shoes from a supplier in China. After Joanne completed her order, the Singapore reseller received the payment and arranged for delivery. Then, the reseller would pay the Chinese supplier.
In this scenario, Joanna and the reseller engaged in a B2C cross-border transaction, while the reseller and supplier engaged in a B2B transaction.
There can be many different sending and receiving methods, the most common being bank transfers, e-wallets and cards.
As cross-border payments require a change of currency, foreign transaction fees and exchange rates, banks and domestic entities work together to transfer funds. This process can be costly and time-consuming.
So, the ability to quickly and securely transfer payments to suppliers and customers in other countries is essential.
This is where understanding the types of cross-border payment solutions comes into place.
1. Remittance
Money service businesses that help individuals send money will need a remittance solution to connect their customers with payout destinations. This solution usually comes with a network of payout partners with local payment methods, such as bank transfers, e-wallet debits or cash pickup services.
2. Corporate payment
Businesses can send and receive payments easily and quickly using a business payment solution. This cross-border solution works in the background to collect payments in payers’ currencies and channel them to payout partners or directly to payees.
3. International airtime transfer
A person in one country can securely and electronically transfer to or top up mobile credit or mobile airtime for another person in another country. When telcos or businesses offer this service to their customers, they usually engage an airtime solution provider. This form of cross-border payment is ideal for sending small amounts of money.
Why Tranglo?
It doesn’t have to be us 😆
Just note this - the cross-border payment solution provider you choose should make cross-border transactions easy for you and your customers. In addition, as your business grows, you will handle more transactions and want someone who can cope and scale.
You can read this on how to choose the best cross-border payments hub, or you can continue reading the shameless plug below.
Tranglo uses a proprietary, single-interface platform to process cross-border payments.
One of the most innovative features of this interface is that it seamlessly integrates transaction instructions and chooses the best local payment processing partners and methods for payout in receiving countries. This feature reduces the reliance on intermediaries, which keeps costs down.
This platform also connects with Tranglo’s global payment network:
And, it offers a host of other add-on services as standard:
You are welcome to speak to us to understand more about cross-border payments and the available solutions.
