{"id":266570,"date":"2024-10-22T09:07:22","date_gmt":"2024-10-22T09:07:22","guid":{"rendered":"https:\/\/imarticus.org\/blog\/?p=266570"},"modified":"2024-10-22T09:07:22","modified_gmt":"2024-10-22T09:07:22","slug":"future-of-cross-border-payments","status":"publish","type":"post","link":"https:\/\/imarticus.org\/blog\/future-of-cross-border-payments\/","title":{"rendered":"The Future of Cross Border Payments: The Impact of DLT and Blockchain Technology"},"content":{"rendered":"
Cross-border payments <\/span>are changing with the advent of Distributed Ledger Technology (DLT) and blockchain. These technologies will change how we conduct global transactions and reduce costs. The benefits? We reap the advantages of sped-up payments alongside increased transparency. This blog looks into the future of these payments and what it means for users.\u00a0<\/span><\/p>\n Consider taking a <\/span>corporate banking program<\/span><\/a> for more insights and essential banking skills.\u00a0<\/span><\/p>\n These payments are money transfers between parties in different countries, often facilitated by banks or financial institutions. Historically, they have been slow, with multiple intermediaries, high fees, and long processing times.\u00a0<\/span><\/p>\n The demand for faster and cheaper payment solutions has grown as the world becomes more interconnected.<\/span><\/p>\n Here\u2019s an example of these payments to support this explanation:<\/span><\/p>\n A small business in the US sells handmade crafts online. European customers who want to buy several items initiate a cross-border payment with their credit card.<\/span><\/p>\n The process involves:<\/span><\/p>\n This shows <\/span>cross-border payments<\/span> are more complex, with multiple parties, currency conversions, and fees involved, than domestic transactions.<\/span><\/p>\n DLT is a digital system that simultaneously records transactions in multiple places for increased transparency and security. Unlike traditional databases managed by a central authority, DLT is a decentralised network where all participants can access and verify the same information.\u00a0<\/span><\/p>\n This is especially relevant to these payments as it can simplify the process and build trust between parties.<\/span><\/p>\n Here are the advantages of opting for DLT in these payments.<\/span><\/p>\n Blockchain technology<\/span>, a part of DLT, is most famous for powering cryptocurrencies like Bitcoin. But its use cases go beyond digital currencies. In these payments, blockchain provides a transparent and immutable ledger that records all transactions so all parties have the same information.<\/span><\/p>\n For instance, a global company uses DLT to send funds to its subsidiary, cutting out the middlemen. This decentralised platform indicates real-time verification, less cost, and less time. DLT means transparency and security, making cross-border<\/span> payments<\/span> easier for global businesses.<\/span><\/p>\n With blockchain supporting this kind of payment, several benefits are seen. These include:<\/span><\/p>\n Despite the benefits of DLT and blockchain, these payments are still a complex space. Traditional systems like SWIFT are still in control, and many banks and financial institutions need to adopt them faster. However, several fintechs are emerging to challenge the norm, using DLT and blockchain to offer new payment solutions.<\/span><\/p>\n Some of the new players in the payment system are listed here. Take a look!<\/span><\/p>\n The future of these types of payments is sorted. As DLT and blockchain evolve, these payments look good. The next steps in this regime may include:<\/span><\/p>\n DLT and blockchain are redefined cross-border payments. These innovations will solve many problems with traditional payment systems, making them faster, cheaper, and more secure. As the world changes, we need to cope with the times.\u00a0<\/span><\/p>\n Towards this initiative, Imarticus has launched an <\/span>Executive Programme in Corporate and Investment Banking<\/span><\/a> in association with IIM, Calcutta. Learn the fundamentals and tap into industry insights with Imarticus. Consider registering instantly to put away a long waitlist. Opt in today!<\/span><\/p>\n What are <\/b>cross-border payments<\/b>?<\/b><\/p>\n Cross-border payments<\/span> are payments between parties in different countries. They can use various financial instruments and involve multiple intermediaries, which means higher costs and longer processing times.<\/span><\/p>\n How does DLT help <\/b>cross-border payments<\/b>?<\/b><\/p>\n DLT aids <\/span>cross-border payments <\/span>by providing a decentralised and transparent way to record transactions. It reduces intermediaries, lowers costs, speeds up processing, and increases security.<\/span><\/p>\n What is the difference between DLT and blockchain?<\/b><\/p>\n DLT is a broader term that means any technology that allows for the decentralised recording of transactions across multiple locations. On the other hand, blockchain is a type of DLT that uses a chain of blocks to secure and verify transactions, and it is known for its transparency and immutability.<\/span><\/p>\n Are there any challenges to using DLT and blockchain for CB payments?<\/b><\/p>\n Challenges include traditional financial institutions' slow adoption of new technology, regulatory uncertainty, and interoperability between blockchain networks. Overcoming these will be key to mainstream adoption in <\/span>cross-border payments<\/span>.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":" Cross-border payments are changing with the advent of Distributed Ledger Technology (DLT) and blockchain. These technologies will change how we...<\/p>\n","protected":false},"author":1,"featured_media":266571,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[22],"tags":[4903],"pages":[],"coe":[],"class_list":{"0":"post-266570","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-finance","8":"tag-cross-border-payments"},"acf":[],"yoast_head":"\nCross Border Payments<\/span><\/h2>\n
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Distributed Ledger Technology (DLT)<\/span><\/h2>\n
DLT in <\/span>Cross Border Payments<\/span><\/h3>\n
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Blockchain Technology<\/span><\/h2>\n
Blockchain for These Types of Payments<\/span><\/h3>\n
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Cross Border Payments<\/span> Today<\/span><\/h2>\n
New Players in CB Payments<\/span><\/h3>\n
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The Future of These Payments\u00a0<\/span><\/h2>\n
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Conclusion\u00a0<\/span><\/h3>\n
Frequently Asked Questions<\/span><\/h3>\n