Enhancing Cross-Border Payments in the U.S.
Posted on Nov 22, 2024 by Margaret Weichert, Chief Product Officer, The Clearing House
As cross-border payments take center stage in today’s globalized economy, Margaret Weichert, Chief Product Officer at The Clearing House, explores the latest initiatives shaping the industry
The cross-border payments industry is on track for a meteoric rise over the next few years, with the total value of the market expected to grow to $290 trillion by 2030, up from $190 trillion today.[1] This trend is particularly relevant for U.S. Dollar (USD) payments, as post-Covid global trade recovery and supply chain diversification are driving disproportionate interest in cross-border USD payments.
The USD’s role as the de facto global currency has created a heightened interest around the world in dollar-denominated cross-border payment capabilities, and how the USD payment systems interconnect with global capabilities. In 2020, the G20 endorsed a Roadmap for Enhancing Cross-border Payments, reflecting the vision of a connected global economy backed by an efficient, secure, and inclusive payment ecosystem. To achieve this, the G20 Roadmap has put together a series of ambitious goals to achieve by 2027, focused on addressing four areas of friction traditionally associated with international payments: speed, transparency, access, and cost.
Behind the G20 Roadmap sits a series of initiatives and measures that are drawing the attention of the full spectrum of actors involved in global payments. In response, financial market infrastructures around the world are rethinking their technology capabilities and operating and risk models to ensure resiliency amid skyrocketing growth. At the same time, financial market infrastructures are working to respond to competitive market dynamics in the payment ecosystem in an environment being transformed by emerging technologies and new players.
The Clearing House (TCH), a U.S.-based, private-sector financial market utility, strives to balance these considerations in its operation of a systemically important payment network that supports the global USD economy. TCH operates the CHIPS® network[2] for high-value USD payments and handles $1.8 Trillion in USD payments each day. To support the future needs of the USD global ecosystem, TCH adopted the ...
[1] https://www.fxcintel.com/cross-border-payments-market-sizing-data
[2] CHIPS® is a registered service mark of The Clearing House Payment Company.
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