Global payments can feel costly and slow because of outdated payment methods, compliance delays, and fees. But forward-thinking businesses treat cross-border payments as something to refine and scale. They consider global money movement as necessary infrastructure for good reason. In 2024, the global market for cross-border payments was worth about $1 quadrillion.

Below, we’ll explain the risks and barriers of cross-border payments and how modern businesses have addressed those to find new opportunities.

What’s in this article?

• How do strong cross-border payment solutions benefit businesses?
  
• What’s involved in modern cross-border payment solutions?
  
• What risk and compliance layers are important in global payment flows?
  
• Which barriers still constrain global payments?
  
• How can finance teams benchmark and upgrade their cross-border payment setups?
  
• How Stripe Payments can help
  

How do strong cross-border payment solutions benefit businesses?

Cross-border payments can help businesses grow internationally and improve cash flow—as long as they’re set up right. Here are benefits you can receive with the right setup:

Expanded reach

When your payments infrastructure supports international customers, it expands your reach by default. A Canadian ecommerce brand can suddenly sell into the UK and Japan, or a software-as-a-service (SaaS) business in Berlin can charge US clients in dollars and keep more of that revenue. Successful cross-border payment solutions let businesses reach more customers, earn in more currencies, and remove many barriers to how global users pay you.

Freed-up liquidity

Traditional international payments are usually slow. Wire transfers often take days to settle, especially when they’re routed through multiple banks or interrupted by compliance checks and time zones. That delay locks up working capital.

Many modern payment providers can dramatically reduce that delay. Some offer same-day or nearly instant payouts or real-time treasury visibility. Others use tools to fund payments on demand rather than days in advance. This means less money stranded overseas and more control over your cash.

Currency flexibility

Multicurrency accounts are another core tool in modern cross-border payment systems. Instead of converting revenue immediately into your home currency, you can hold funds in the currency they came in. That helps you avoid unnecessary foreign exchange (FX) conversions, pay local vendors from local balances, and time conversions to when rates are favorable.

Stripe Payments, for example, lets businesses hold and spend from multicurrency balances directly. This eliminates conversion issues and helps smaller teams operate globally without extra overhead.

What’s involved in modern cross-border payment solutions?

The old way of sending money abroad—international wire transfers routed through several banks—was built for slower expectations. That process still works, but it’s not fast or cheap. Multicurrency wallets and local payment networks are changing that.

Multicurrency wallets

Instead of converting incoming payments to its home currency, a business can hold them in their original currencies in multicurrency wallets. This means no unnecessary FX conversions, payments to vendors or contractors can be made in the matching currency, and businesses can convert when rates are favorable.

A business that earns in US dollars, euros, and British pounds can match inflows and outflows locally, avoiding double conversion and minimizing exposure to rate swings. Payment providers such as Stripe have rolled out multicurrency balances for this reason.

Local payment networks

Local payment networks are the domestic payment systems that move money within a given market. Examples include the Automated Clearing House (ACH) system in the US, the Single Euro Payments Area (SEPA) in Europe, the Unified Payments Interface (UPI) in India, and Sistema de Pagos Electrónicos Interbancarios (SPEI) in Mexico. Many of the top cross-border solutions tap in to these networks on both sides of the transaction. For instance, a US business that’s paying a contractor in Mexico might fund the payment via ACH in the US. The provider could settle it locally via SPEI in Mexico, and the contractor would receive pesos quickly with no surprise deductions.

This approach bypasses the traditional wire transfer. It’s usually faster and cheaper, with no intermediary bank fees, no backend surprises, and far more transparency about delivery times and final amounts.

Multicurrency wallets and local payment networks don’t eliminate the complexity of global payments, but they make it manageable. It’s a smoother experience for both sides of the transaction.

What risk and compliance layers are important in global payment flows?

Every time money crosses a border, it has the potential to pick up regulatory, functional, or reputational risk. A good payment provider should help you mitigate that risk. When you choose a payment provider, ensure it can handle these challenges:

Identity and verification

Know Your Customer (KYC) and Know Your Business (KYB) rules require you to verify whom you’re doing business with. That can mean collecting and validating personal IDs, legal business docs, and ownership structures. The higher the transaction volume or jurisdictional risk is, the more scrutiny could be applied.

Real-time screening and monitoring

You need to screen every cross-border payment for warning signs in real time. These checks are looking for sanctioned parties (e.g., from lists by bodies such as the US Office of Foreign Assets Control, the UN, and the EU), high-risk geographies, or transaction anomalies that resemble money laundering patterns.

Screening must happen fast without slowing your operations. The best systems build this into the payment flow so your team isn’t triaging false positives all day.

Fraud and attack surface

Longer settlement times and more intermediaries give fraudulent actors a lot of potential surface area to work with. Business email compromise, account takeover, card fraud, and social engineering attacks are all concerns in cross-border flows. To protect both sides of the transaction, payment systems should embed fraud detection natively.

Local rules with global consequences

Different countries apply different restrictions on how money enters or leaves their systems. These restrictions include capital controls, currency limits, tax withholding rules, and transaction reporting thresholds. Cross-border compliance means understanding those constraints and working with providers who incorporate them in the payment system.

Which barriers still constrain global payments?

Despite all the progress in cross-border payments, there still isn’t full interoperability. Though the technology and capability exist in theory, the world doesn’t run on one system.

Here are the lingering problems:

Payment systems don’t talk to each other

Domestic payment systems weren’t designed to connect. Each market built its own stack, with its own rules, formats, and clearing hours. Linking them means reconciling application programming interfaces (APIs), legal frameworks, compliance standards, and settlement expectations.

Even with real-time payment networks, many still batch payments overnight, shut down on weekends, or operate within rigid banking hours.

Regulations don’t sync

Capital controls, licensing requirements, and data laws vary by jurisdiction. A payout that works in one country might be illegal, delayed, or heavily restricted in another. There’s no global regulator to resolve that issue.

Money is still cultural

Local payment methods are so deeply embedded in some markets—think the Pix real-time payment system in Brazil or Konbini cash payment system in Japan—that a cross-border solution might as well not exist if it doesn’t plug in to them.

The tools are improving, but integration still depends on where you’re sending money, who’s receiving it, and how the system in between is built.

How can finance teams benchmark and upgrade their cross-border payment setups?

Many finance teams still don’t fully understand cross-border payments. So it could be a surprise when a vendor doesn’t get paid, a transaction goes missing, or fees appear where they weren’t supposed to. It’s possible to start benchmarking and refining with a few tactics.

First, monitor these metrics:

• Total cost per payment, including FX markups

• Time to credit, measured from initiation to final delivery

• Failure or exception rate, especially transfers that bounce back or require manual reviews

Then, you can build a simple dashboard by corridor, compare against G20 benchmarks, and look for outliers.

Finally, you should improve your setup like it’s part of your business model. Work with a payment provider that can:

• Choose the fastest payment networks

• Shift volume to lower-cost corridors

• Consolidate fragmented bank setups

• Add validation checks to reduce retries

• Make compliance part of the flow

Cross-border payments are a living system. The more visibility and control you add to it, the better positioned it is to help your business succeed.

How Stripe Payments can help

Stripe Payments provides a unified, global payment solution that helps any business—from scaling startups to global enterprises—accept payments online, in person, and around the world.

Stripe Payments can help you:

• Optimize your checkout experience: Create a frictionless customer experience and save thousands of engineering hours with prebuilt payment user interfaces (UIs), access to 125+ payment methods, and Link, a wallet built by Stripe.

• Expand to new markets faster: Reach customers worldwide and reduce the complexity and cost of multicurrency management with cross-border payment options, available in 195 countries across 135+ currencies.

• Unify payments in person and online: Build a unified commerce experience across online and in-person channels to personalize interactions, reward loyalty, and grow revenue.

• Improve payment performance: Increase revenue with a range of customizable, easy-to-configure payment tools, including no-code fraud protection and advanced capabilities to improve authorization rates.

• Move faster with a flexible, reliable platform for growth: Build on a platform designed to scale with you, with 99.999% historical uptime and industry-leading reliability.

Learn more about how Stripe Payments can power your online and in-person payments, or get started today.