The world clearly needs better cross-border payments
Wake up, America! Fintech is getting away… 🇺🇸
Rivka Abramson| Nov 09, 2023
Welcome to all CFOs, finance pros, and fintech enthusiasts.
This week, we’re talking about cross-border payments.
What you need to know right now:
The world needs a better cross-border payments network – Financial Times
The new governor of the Bank of Italy is calling for a better cross-border payments network – and you won’t see us argue.
Here’s what Fabio Panetta had to say in his Financial Times op-ed:
- Global payments are expected to rocket from $190tn in 2023 to a staggering $290tn by 2030.
- Despite this amazing growth, cross-border payments remain expensive and slow.
- There are concerns about alternative payment solutions like volatile cryptos and stable coins, as they’re prone to runs.
- Linking over 70 domestic fast-payment systems globally could enhance digitization benefits for cross-border payments, improve efficiency, and support developing economies through international standards and assistance.
- Europe’s TIPS mechanism exemplifies successful instant cross-border payments within a unified system, and the public sector must address compliance costs and regulatory disparities to foster a cooperative global network for efficient and accessible international payments.
- Cross-border payment difficulties and expenses often prevent small and medium-sized businesses from growing internationally.
We’d add that cross-border payment complexities aren’t just harmful to small and medium-sized businesses. They’re a huge drag on enterprise-level growth.
Because the larger your business becomes, the more complex its payments requirements become.
That means juggling foreign bank accounts, trusting unregulated third parties with your working capital, and tolerating endless errors and delays due to bottlenecks and delays caused by someone else’s technology.
The end result is hamstrung finance teams who spend too long on admin and firefighting when they could be focusing on strategic tasks that generate growth.
One year ago, we launched Papaya Global payments to solve that problem once and for all. It’s now the fastest-growing workforce payments company.
What else to read:
- Elon Musk plans to expand X (formerly known as Twitter) to manage users’ complete financial lives, eliminating the need for separate bank accounts by the end of 2024.
- Musk envisions the platform offering a broad spectrum of financial services, handling everything involving money and securities.
- X is in the process of acquiring money transmission licenses across the US, with a goal to introduce various financial features by the end of the next year.
- Twitter has previously introduced financial elements like tipping and subscription fees for content, but Musk’s ambition is to significantly extend these services.
- Musk criticized PayPal, which he co-founded as X.com, for not implementing and even rolling back some features he and David Sacks had planned, expressing a desire to realize those original ideas with X.
We wrote about Musks’s plans way back in August. Check it out 👇
Elon Musk’s next opponent is not Mark Zuckerberg (regardless of ACL status)
How quantum computing could transform the banking sector – Fintech Magazine
- Quantum banking, leveraging quantum computing and blockchain, promises to revolutionize financial services with faster and cheaper payment mechanisms by eliminating traditional intermediaries.
- A recent report published by Temenos surveyed 300 executives across retail, commercial, and private banking around the world. Among other things, it found that 63% of executives thought new technologies – including quantum computing – would have the biggest impact on banks in the next five years, compared to just 34% for the next most popularly cited trend: changing customer behaviors.
- The global quantum computing market is expected to grow substantially, with projections reaching $1.77bn by 2026, and financial services stand to benefit greatly from this advancement.
- Quantum computing offers significant speed advantages, processing data millions of times faster than current supercomputers, which could revolutionize risk management and financial analysis for banks.
- Early adopters of quantum banking may gain a competitive edge despite challenges like scalability, cost, and regulatory scrutiny.
- Widespread commercial use is estimated to be around a decade away, yet firms are encouraged to prepare for this transformative technology.