Introduction
Within today’s society, cross-border payments have proven to be quite the hype as they provide people with the opportunity to manage their money effectively at a global scale no matter the currency. In this week’s blog post we look into the benefits of cross-border payments, particularly focusing on the social impact and opportunities it offers as well as some of its drawbacks.
Greater Social Impact
One of the advantages of cross-border payments is that it drives for a greater social impact whether that is through improving economic growth, financial wellbeing or opening up opportunities for wider communities. Due to their fast nature, they remain a convenient method for people to send money to loved ones back home or aid international business owners. No matter the circumstance, cross-border payments are not only effective but they also promote financial inclusion and are crucial to global development.
Wider Customer Reach
As mentioned, cross-border payments promote greater financial inclusion, allowing people from all areas to send and receive money regardless of their location (rural or urban). Due to this, most platforms that allow consumers to perform cross-border payments have multiple payment options available for them to do so, ranging from digital wallets, credit cards, and wire transfers. Ultimately, this makes it accessible for all.
Technical Failures
Despite all the benefits cross-border payments offer such as convenience, efficiency and speed, a major drawback of it is when there are technical failures. Technical failures can be a major inconvenience as they are not always predictable and with a service like cross-border payments this can delay transactions and open up security risks if there is a technical failure when a user is making a transaction. However, with the way technological advances are moving upwards, security risks are set to become less when technological failures happen.
What the future holds
From looking into the various advantages regarding cross-border payments, it is evident that they are extremely beneficial in today’s society. Regardless of unpredictable issues such as technological failures, cross-border payments are extremely effective for businesses, personal use and global trade and remain a crucial sub-sector within FinTech.
