Global coverage refers to payment providers’ ability to process payments in different currencies, integrate with different payment systems, and comply with regulations in different countries. Typically, payment distribution platforms with global coverage have the infrastructure and partnerships needed to make this happen.
For businesses with operations in several countries, partnering with a payment distribution platform with global coverage can offer big benefits. But even for businesses with only local operations, partnering with a PSP with global coverage offers leeway to expand into new markets with a smoother process and less stress involved.
It’s pretty much a must for businesses to evaluate PSPs’ capabilities on a global scale in order to decide whether to partner with them. PSPs with limited coverage can translate to limited growth for the business.
How does global coverage work?
Global coverage isn’t exactly what you’d call a walk in the park (or a walk in multiple parks — across the globe).
The process can be time-consuming. On the PSP’s part, it involves investing a whole lot of time in things such as:
- Researching the market
- Digging into local regulations and policies
- Building relationships and partnerships with FIs and payment processors in relevant regions.
All this is what ultimately allows global payments providers to process payments in local currencies and comply with country-specific regulations.
But the fun doesn’t stop there. Global coverage is as dynamic and changing as the globe itself. For the PSP, this means continuous effort into making sure it’s staying up to date with local regulations and payment standards and updating its services accordingly.
Challenges with providing global coverage
Each step of the global coverage process comes with its own share of challenges. We dive into each of these below:
Establishing local partnerships takes time and a lot of resources from the PSP. It involves building relationships with financial institutions and payment processors, firms which may have their own lengthy protocols for evaluating potential partners.
Regulations differ within every country. On top of that, they’re always subject to change. PSPs need to stay on top of these changes so that they’re always up to date with policies. And this applies for every country they offer their services for, by the way.
Language and cultural barriers
At the core of every global payment cycle is the person being paid. With that, a lot of PSPs struggle with making sure their communication and services are adapted to fit local norms and expectations.
Fraud and security
Just like culture and languages vary country to country, so do the different types of fraud and security threats. payment service provider need to keep themselves updated regarding each country’s most common forms of these threats.
Expertise and infrastructure are the bread and butter of any good payment service provider. And that’s doubly true when we’re talking about systems built for payments processed in different currencies, across different regions.
Global Coverage in context of global workforce payments
Partnering with a payment distribution platform that has global coverage is pretty much a must for companies with employees spread out across the world. It ensures that salaries are both in compliance with local regulations and timely in their arrival in employees’ bank accounts.