Visa and Revolut are launching Instant Card Transfers, a platform designed to mitigate the challenges of cross-border business payments.
Organizations that transfer funds internationally have long contended with high transaction fees and prolonged processing times. In addition, each country has its own set of regulations for cross-border payments. Instead of searching for IBAN numbers and Bank Identifier Codes, Revolut’s business clients will only need a card number to send money internationally.
Instant Card Transfers is expected to reduce the multi-day delays often associated with cross-border payments, with many transactions reaching their destination in less than 30 minutes.
Significant Strides
The new offering will be available in over 78 countries and support 50 currencies. This platform gives small- to medium-sized businesses an opportunity to expand their global footprint, although it will initially be open only to UK and EU members.
Since its inception in 2015, UK-based fintech Revolut has made significant strides, including securing its long-awaited UK banking license. The fintech has also announced plans for U.S. expansion, although it has not yet filed for a U.S. banking charter.
A Global Framework
Commercial payments have become so complex that even many seasoned financial professionals may not grasp all their nuances. With cross-border business payments, substantial sums change hands through various methods, and companies have to account for currency conversions.
The demand for cross-border solutions is unlikely to decline given the ever-growing globalization of business. Progress toward establishing a global framework for cross-border payments has been slow, but platforms like Swift and BIS’s Project Agora are designed to address this gap.
However, the most effective candidates for facilitating global cross-border payments already have a framework in place.
“There are several options that could fill that gap and deliver the infrastructure for cross-border payments, but it’s still not clear which one will emerge,” said Albert Bodine, Director of Commercial and Enterprise Payments at Javelin Strategy & Research, in a previous conversation with PaymentsJournal. “Visa and Mastercard would be perfect candidates for cross-border payments because they already have an established global highway. It could be a great addition to their business, especially if there’s a reduction in credit card interchange fees.”