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Are You the Payment Provider of Choice for Cross-Border Transactions?

May 13, 2024

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What Customers Want in a Cross-Border Payments Provider

To capture global market share as a cross-border payments provider, learn what people and businesses seek in digital and real-time payments.

From sending money home to one’s family overseas to businesses paying off their supply chains across nations, the demand for digital, instant, cross-border payments is only expected to rise. Banks and other payment enablers will play a key role in the growth of the global payments market. There are huge opportunities to be harnessed by those that can meet consumer needs of seamless payments with just the click of a button or tap of a finger. This is evident from the expectations that the digital payments market will reach a transaction value of $11.55 trillion in 2024, growing thereafter at a CAGR of 9.52% to facilitate transactions worth $16.62 trillion by 2028.

If you want to capture a piece of this massive pie, you first need to understand what customers (both individuals and businesses) look for in their payment provider of choice.

What Customers Want

The Society for Worldwide Interbank Financial Telecommunications (SWIFT) conducted a survey on 4,205 individual customers and 2,720 SMEs across eight of the largest payment markets in the world – the US, UK, Australia, China, India, Germany, South Africa, and Saudi Arabia. The report, published in July 2023, revealed that individual consumers prioritized transparency, trust, and security as the top factors in choosing a payment provider. SMEs, on the other hand, included an additional requirement to this list of priorities – the ability to integrate a payment solution into their business ecosystem.

The Technology

Most customers, both individuals and businesses, do not understand the intricacies of cross-border payments. They trust their service provider to handle the journey to give them a smooth and hassle-free experience. Establishing your expertise in the field, therefore, becomes an important factor in being a brand of choice. This also means having the right tech stack to facilitate seamless cross-border payments. So, choose your infrastructure investment wisely because 91% of customers will not do business with a company after a single bad experience.

Security

Customers will also want to know that their funds are in safe hands, and protected against cybercriminals and fraudsters. Interestingly, both individuals and businesses associate banks with stronger security and, therefore, greater trust, as compared to alternative service providers. They believe that banks maintain high security standards, keeping their money safe even during cross-border transactions. This is evident from the SWIFT survey mentioned above, which reveals that 87% of SMEs and 81% of individual customers tend to first explore bank offerings while looking for a cross-border payment solution.

Cost, Speed, and Ease of Use

Customer experience matters. The entire customer journey should be smooth and seamless. This means that payment providers, including banks, credit unions, and other FinTech payment enablers need to transform the front end of their app or website, such that they build a strong relationship right from the onboarding stage. The key is to create user experiences that are as simple as possible, with services being available as easily as placing an order on an e-commerce site.

The top three reasons customers say they would switch brands include ease of use, speed, and cost. Both individuals and businesses want their transactions to be easy to conduct, priced reasonably (including FX charges and fees), and arrive on time to the recipient. In fact, 33% of customers will first shop around to find the best deals before sending cross-border payments. Experts believe customers’ curiosity to explore other options will only grow with time. So, payment providers need to stay on top of customer needs to be chosen as the preferred payment provider.

While 97% of SMEs and 96% of individual customers say they were satisfied with their current payment provider, 75% would consider switching to an alternative if they offered more or better services.

~ SWIFT

SMEs Have Similar Needs

While SMEs have the same priorities of trust, transparency, and security, they have an additional need to embed the payment solution into their own platform. This is because it simplifies operations if businesses can complete their daily tasks from a single place. For example, the cross-border payments solution could be integrated with ERP or payroll to ease payments to teams across locations.

Other Expectations

In a world that has come to expect same-day delivery, can expectations for cross-border payments be far behind? Both individual and business customers are increasingly expecting instant payments, if not within seconds, then within a few minutes. Another important consideration when choosing a payment provider is the ability to track the progress of the transaction.

There also are factors that consumers consider when rejecting payment providers. Of these, the top three reasons for not using a provider again include delivery failure, lack of clarity regarding currency exchange rates, and hidden fees. And a single bad experience is enough for a loyal customer to take their business to your competitor. Remember that no one likes unpleasant surprises. Provide all information upfront and remain transparent regarding all associated fees and charges.

Did you know?

Hidden fees evoke a stronger negative reaction than payment delivery failure!

Did you know?
Hidden fees evoke a stronger negative reaction than payment delivery failure!

Make the Most of Market Opportunities

The numerous opportunities in the payment market are available to those who best meet customer demands. With the market poised for explosive growth and the imminent implementation of the global ISO 20022 messaging standard for cross-border payments, the time to innovate your offerings and improve your tech stack to deliver exceptional customer experiences is now. This is the only way to retain existing customers, attract new ones, and maybe even win back some that might have left.

Increasing customer retention rates by just 5% can increase profits by between 25% and 95%.

Research reveals that the rise of e-commerce, adoption of embedded payment platforms, and decline in the unbanked populations worldwide will only spur the growth of the digital payments market. With almost 3 decades of experience in the finance sector, Opus Technologies is taking banks, credit unions, and third-party service providers into the future of payments. Our state-of-the-art multi-channel payment technologies power you to offer next-generation payment solutions for memorable customer experiences. Contact our experts today to learn how we can support your business to enable seamless digital payments.

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