Breaking the Barriers: 3 Cross-Border Payment Trends to Watch

Consumers in today’s global economy are cultivating a truly “borderless” frame of mind. Not only are they open to purchasing goods and services from merchants and vendors regardless of location, but technology (along with some policy, of course) is making it possible, enabling them to access and pay for solutions that, in the not so distant past, were out of reach. The barriers, as they say, are being broken down. Let’s take a look at three key ways this is happening across the B2B landscape:

Removing the Time Barrier: The Uptake of “Pay Anytime” Solutions

Out of the gates, it’s important to note that the preferences of business payers are being strongly impacted by their experiences as individual consumers. They’re working on smart devices and continuing to adopt digital payment channels for their convenience and growing ubiquity—yes, even in the business market. Companies, especially those working with global partners who need more flexible and affordable payment alternatives, are working hard to meet customers’ new expectations.

They’re looking to provide what global workforce payment solution provider Hyperwallet calls “’Uber’ moments.” Their Top 5 Trends in Global Payments 2017 report describes these as opportunities to experience payments that are personalized, secure, and available 24/7. They suggest that companies will need to give payees complete control over how and where they receive payments—and specifically, on the B2B side, they say “CFOs and treasury teams will look for one simple solution that will enable them to pay anyone, anywhere.”

According to McKinsey & Co’s take on The Future of Global Payments in 2014, this includes an increased attention on real-time payments, which they believe could create an additional revenue pool of $80 billion by 2018 through the replacement of cash transactions with electronic transactions. See How is the World Participating in Non-Cash Transactions for related insights.

Removing the Technology Barriers: The Updating of Legacy Systems

For most companies, it’s already happening: the movement of hardware-heavy infrastructures into more agile, cloud-based (or at least more streamlined) technology environments. The primary reason payment organizations are overhauling their IT approach is to accommodate new, time- and money-saving technologies, most of which now enable e-payments and related functionality. Another reason is to better connect to various business partners that most certainly include a wide range of suppliers and banks.

By most every account, the entire financial industry simply has to grow beyond legacy systems to survive—considering the number of non-banks disrupting the market. In fact, it’s widely remarked, as in Aite Group’s Cross-Border Payments: Challenges and Trends, that new digital players and traditional banks will have to join forces to succeed. The same idea applies to AP departments and their supplier base. Read Supplier Relationships Believed Central to B2B Customer Engagement for more about the importance of B2B partnerships.

Removing the Data Deficiency Barrier: The Rise of Transparency

Transparency and data access are two things all players in the global payments value chain are soon to expect, if they haven’t already achieved it. Financial institutions and corporate AP departments alike have been strengthening their data capture and analysis efforts, and increasing reliance on data to drive insights and strategy. McKinsey & Co’s The Future of Global Payments, looks at the shift in power from data accumulation to data insights and applications.

In today’s marketplace, this might be more critical than ever, as J.P. Morgan Chase presents in 4 Cross-Border Payments Trends to Watch. They contend that companies will be taking a stronger focus on compliance and transparency to combat the risks associated with “modern” global issues. Terrorism, for example, creates a need for global payments that are more diligently safeguarded via verification, stricter laws, and more detailed reporting.

Breaking the Payments Barrier?

The end result is that when it comes to making cross-border payments across the B2B landscape, payments professionals are embracing a whole new way to even think about transacting business and begin planning for tomorrow. They’re rapidly changing how they manage the payments process, from the tactical to strategic, finding opportunities to transform workflows and free up time and money to do more than tackle administrative to-do lists. And they’re also reinventing the way they interact with suppliers, in many cases learning how to add long-term value to relationships through innovative, globally accepted digital payment methods like virtual card numbers (VCNs).

For more on this topic, take a look at It’s Time for Cross-Border Payments Innovation and 5 Ways VCNs Ease Your Cross-Border Payment Pains.