Webinar recap: How banks can turn G20 pressure on cross-border payments into revenue opportunities

In a recent webinar hosted by The Paypers’ Melisande Mual, industry experts David Bagshall, VP of Partnerships at TerraPay, and Gijs Schreuder, Senior Payment Advisor, explored how banks can transform regulatory pressure into strategic opportunities in this rapidly evolving landscape.

The global payments landscape is undergoing a revolutionary transformation. With over 4.5 billion digital wallet users worldwide and a USD 18 trillion low-value cross-border payment market at stake, banks are facing unprecedented pressure to modernise their international payment capabilities. The G20's ambitious 2027 roadmap demands nothing less than a complete reimagining of how money moves across borders: faster, cheaper, more transparent, and more inclusive than ever before.

The G20 vision: four pillars of payment transformation

The G20's cross-border payment roadmap centres on four critical pillars that aim to revolutionise international transactions by 2027. As David Bagshall explained, the current reality is stark: traditional cross-border transactions can take 2-4 days and cost 7-8% of the transaction value. The G20 vision demands a dramatic shift: transactions processed in under an hour at costs below 1%.

‘In this day and age, we should be looking at how we can make transactions processed in under an hour, in under a minute, and also have a vastly reduced cost,’ Bagshall emphasised. This isn't just about efficiency; it's about financial inclusion and humanitarian impact, ensuring that communities worldwide can access funds when they need them most.

The digital wallet revolution: connecting 4.5 billion users

One of the most significant developments in cross-border payments is the rise of stored-value digital wallets. Unlike closed-loop systems like Apple Pay, these wallets, including M-Pesa in Kenya, GCash in the Philippines, and Alipay in China, allow users to receive, store, and spend money directly in local currency.

TerraPay has achieved true interoperability between these stored-value wallets. ‘This has never been done before,’ Bagshall noted. ‘You can now send funds directly from an M-Pesa wallet to a GCash or WeChat Pay wallet instantaneously.’ This breakthrough is particularly transformative for regions like Africa, where traditional inter-regional bank transfers can take several days.

Real-time networks and regional initiatives

The push for 24/7/365 payment capabilities is reshaping the global financial infrastructure. Initiatives like Nexus in Southeast Asia and PIX in Brazil are connecting local real-time payment networks for cross-border transactions, moving away from traditional banking hours.

‘We all live in a world on demand,’ Bagshall observed. ‘We want films on demand, music on demand. Why should payments be any different?’ This shift represents more than convenience; it's about economic efficiency and meeting the expectations of a digital-first generation.

The ISO 20022 migration: from 50-year-old systems to modern standards

Banks are undertaking a massive technological transformation, migrating from MT protocols that have been in use for 50 years to the new ISO 20022 standards. This migration enables richer data transmission, faster processing, and reduced delays from improved due diligence checks.

Gijs Schreuder stressed the importance of global standardisation: ‘I really would call the banks to sit together and enforce a real, single standard when it comes to ISO 20022.’ He warned against regional dialect differences that could fragment the system and reduce efficiency gains.

The stablecoin factor: a game-changing development

Stablecoins are emerging as a potentially transformative force in cross-border payments. Major US banks are already offering stablecoin services to global businesses, recognising their potential for liquidity efficiency and cost reduction.

‘The funny thing about stablecoins,’ Schreuder noted, ‘is that this completely new area really meets the goals and targets of G20, faster, transparent, and cheaper.’ The 24/7/365 availability of stablecoin transactions represents a significant advantage over traditional banking systems.

The Swift-TerraPay partnership: a strategic blueprint

The collaboration between Swift and TerraPay exemplifies the partnership approach that's becoming essential in modern banking. Swift, with its 11,500+ member banks, recognised it couldn't connect to 150+ digital wallets alone. Through the partnership, banks can now leverage TerraPay's network to deliver real-time transactions to digital wallets worldwide, with 98% of transactions completing in under a minute.

A practical example shared by Bagshall illustrated the impact: a bank serving Southeast Asian diaspora communities can now offer direct transfers to GCash wallets in the Philippines. Students working abroad can receive funds from their parents at vastly reduced costs, accessing money immediately for essentials like food, healthcare, and education.

Strategic priorities for banks: the path forward

For banks navigating this transformation, Schreuder offered crucial strategic advice: ‘update your global payment strategy, but don't make it too long – only for the next two to three years.’ He emphasised that standing still equals losing ground in this rapidly evolving market.

The build-versus-partner decision has become critical. As Bagshall pointed out, even Swift has recognised that it can't do everything alone. Banks must evaluate whether to build capabilities internally, acquire fintech companies, or partner with specialised providers to meet the G20 goals while competing with digital-first entrants.

Key takeaways

• The USD 18 trillion opportunity: low-value cross-border payments represent a massive and growing market that banks cannot afford to ignore.
• Partnership is essential: no single institution can build all the capabilities needed to meet G20 goals; strategic partnerships with fintechs and infrastructure providers are crucial.
• ISO 20022 is foundational: banks must complete their migration to new standards while avoiding regional variations that could fragment the global system.
• Digital wallet connectivity is critical: with 4.5 billion wallet users globally, banks need direct access to these networks to serve their customers effectively.
• Real-time is the new normal: 24/7/365 payment capabilities are no longer optional; they're essential for competing in the modern economy.
• Stablecoins cannot be ignored: banks must develop strategies for stablecoin integration as these instruments gain traction in cross-border payments.
• Customer experience drives everything: the ‘consumerisation’ of business payments means B2B transactions must match the speed and convenience of consumer payment experiences.

Conclusion

The transformation of cross-border payments represents both an enormous challenge and an unprecedented opportunity for banks. The G20's 2027 goals are ambitious, but the technology and partnerships to achieve them already exist. Banks that act decisively now, embracing partnerships, investing in modern infrastructure, and prioritising customer experience, will be positioned to capture their share of the USD 18 trillion market.

As Schreuder concluded, ‘doing nothing is not an option.’ The question for banks isn't whether to transform their cross-border payment capabilities, but how quickly they can move to meet the demands of a rapidly evolving global economy. Those that successfully navigate this transformation won't just meet regulatory requirements – they'll unlock new revenue streams, strengthen customer relationships, and play a vital role in creating a more inclusive global financial system.

This webinar recap only highlights the key points of the discussion. For the complete take on merchant expansion strategies, including the Q&A at the end, watch the webinar recording here.

About the author

Vlad is a Senior Editor at The Paypers, working in the Banking & Fintech team. He uses his research, content, and people skills for all activities revolving around Open Banking and Open Finance. Vlad has a degree in Biology and Molecular Genetics and an extensive background in creative writing. You can reach out to him on LinkedIn or email.

 

 

About the company

 

TerraPay partners with banks, money-transfer operators, wallets, and licenced global businesses to enable global money movement. TerraPay is headquartered in London, with offices in Bangalore, Dubai, Miami, Bogota, Dakar, Joburg, Nairobi, Milan, DaresSalaam, Kampala, Hague, and Singapore. Its investors include the IFC (the World Bank), Prime Ventures, Partech Africa, and Visa.