4 trends shaping cross-border payments in Asia
As the global economy becomes increasingly interconnected, an increase in low-value cross-border transactions by retail customers and small businesses has driven Asia's volumes to a staggering $3.9 trillion SGD in global outflows.1
While this represents a massive revenue opportunity for banks and businesses, delivering a seamless cross-border payment experience that keeps pace with evolving customer needs remains a significant challenge.
To stay competitive, financial service providers must adapt to rapidly evolving customer expectations - offering solutions that are not only faster and more convenient, but also cost-effective. Achieving this successfully requires a dedicated focus on building a robust network, implementing real-time treasury management, ensuring scalable compliance and driving operational automation - all to deliver an exceptional payments experience.
Real-time expectations
Today's customers expect nothing less than instant and frictionless transactions, whether they're making payments at home or abroad. In Asia, the demand for real-time payments has skyrocketed, driven by a surge in fintech investments, digital transformation and supportive regulatory changes. In fact, real-time payments in the APAC region alone are poised to soar, surging from 49.2 billion transactions in 2022 to a staggering 96.2 billion by 2027. 2
What’s more, customers are now seeking greater transparency from their financial service providers, driving organisations to be upfront about costs and delivery times. To retain loyal customers, providers must deliver seamless global payment experiences - or risk losing out to competitors who can.
1. Network optimisation: Getting the right framework for speed
Building the right network with direct connections into instant and local payment systems is key for success, achieving greater efficiency and transparency for customers. However, this is not easy to achieve, as it requires providers to establish deep local expertise, navigate regulatory complexities and cultivate central bank relationships, not to mention maintain an on-the-ground presence. While these trends present new opportunities for providers, they also bring significant challenges. That's why partnering with fintechs who already have a pre-established network and local presence is often the most efficient way for banks and businesses to drive innovation and reach new markets.
At Wise, we've spent 14 years building a scalable global network that directly connects to six payment systems, with over 90 banking and payments partners. Banks and businesses plug into our trusted payments infrastructure to access 160+ countries and 40+ currencies.
It's also this same infrastructure that allows us to move customers’ money around the world instantly. With 63% of Wise Platform’s global payments arriving in under 20 seconds, we enable our partners to deliver a fast, affordable payments experience without a major technical overhaul.*
2. Operational automation: Shaping the future of efficiency
Agile global payments providers offer a distinct edge - they laser-focus on the singular challenge of fast, affordable and convenient cross-border payments. Unencumbered by legacy infrastructure, these fintech innovators heavily invest in cutting-edge artificial intelligence (AI), machine learning (ML) and large language models (LLM) to drive their solutions.
As an established global payments infrastructure provider, our unique blend of advanced tech and deep local expertise sets us apart. At Wise Platform, we've automated manual tasks and reduced customer friction through AI, ML and LLM, achieving a 99% straight-through processing rate for our partners and their customers. And while operational automation is essential for scaling cross-border payments and delivering instant transactions, the benefits extend far beyond. Streamlining payment processing slashes significant customer support costs for our partners.
In fact, these efficiencies have enabled us to process 1.2 billion payments with just 300 people on our payments operations team over the last year. We use ML and AI to automatically resolve customer inquiries in near real-time, driving an exceptionally low contact rate of just 0.42% per transfer.
What’s more, operational automation also enhances the speed and security of our payments processing, allowing partners to manage increasing transaction volumes while upholding robust compliance.
3. Treasury management: Engineering for success
Operational automation also delivers benefits across treasury management, but enabling this is no small feat. The real challenge lies in securing the necessary liquidity - predicting where and how much money will be required before it's actually needed, and keeping trading costs and spreads low to minimise expenses for customers in major and emerging market currencies. Equally crucial is delivering a guaranteed, transparent rate on payments, as consumers and businesses demand consistency.
Yet, many organisations struggle to achieve this, grappling with outdated infrastructure, limited resources and tight budgets. While banks excel at major currency treasury, the decline of correspondent banking and market volatility force them to scramble for access to the fast-growing world of emerging market currencies. Volatile exchange rates and highly localised conditions further complicate efforts to optimise and predict liquidity across emerging markets.
Luckily, with 65+ licenses, Wise Platform partners can instantly provide global liquidity while ensuring full compliance. But it’s not just about having the right network, liquidity and cost structure. Our unique expertise in banking, combined with cutting-edge AI models and engineering, allows us to deliver seamless real-time treasury management. Thanks to this innovative approach, our partners' customers can access rates in over 40 currencies, 24/7 and 365 days a year.
4. Combining compliance at scale with deep local expertise
Managing liquidity is only one piece of the puzzle; providers must also navigate a complex web of compliance requirements and local regulations to deliver instant payments. Success hinges on developing tech-driven compliance practices, real-time data validation and regional specialists to acquire accurate information at speed and avoid transaction failures. But this comes at a steep cost - a recent report found the Asia-Pacific region alone spent $45 billion on financial crime compliance in 2023.3
On the journey to delivering instant payments, compliance checks- particularly those related to sanctions, fraud and AML - must happen in the blink of an eye. Thankfully, with the right technology and local expertise, this is all possible.
At Wise Platform, over 150 ML algorithms run seven million checks daily, performing 80 checks per second to identify potential fraud, sanctions violations and AML risks. What’s more, our team possesses deep local expertise, with a significant percentage of the regional workforce focussed on fincrime alone.
Collaboration has never been so crucial
Navigating the complexities of building a robust network, operational automation, real-time treasury management and scalable compliance is a challenge for banks and businesses alike.
Wise Platform’s API and correspondent service solutions allow partners to tap into an extensive global network to deliver fast, low cost and transparent payments - all without a major technical overhaul.
This collaborative approach is shaping the future of instant payments across Asia and beyond, empowering global payments providers to compete more effectively in the cross-border payments space.
By transforming the way banks and businesses send and receive global payments, we’re helping our partners to increase NPS scores, reduce costs, ensure compliance and drive exceptional payments experiences.
Learn more about Wise Platform
*Transaction speed claimed depends on individual circumstances and may not be available for all transactions. Information is accurate as of the date of publication.
Sources:
- McKinsey (2022). McKinsey Cross Border Payments Map.
- ACI Worldwide and Global Data (2023). “It’s Primetime for Real-time 2023.”
- Lexis Nexis (2023). "The True Cost of Financial Crime Compliance."
*Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up to date pricing and fee information.
This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.
