What Are Cross-Border Payments? A Primer for Banks and Institutions, Enterprises, and Retail

Cross-border payments, essential for global commerce and finance, involve transferring value between parties in different countries and often face challenges due to their reliance on a complex web of intermediary banks, leading to high costs, slow processing times, and limited transparency. Despite the importance of these payments, the traditional systems that support them have remained largely unchanged since the mid-20th century, resulting in inefficiencies and significant costs estimated at $120 billion annually. Key issues include high and unpredictable costs, slow settlement, liquidity constraints, and regulatory complexities, which together hinder efficient international transactions for businesses and individuals alike. To address these challenges, innovations such as the Circle Payments Network (CPN) are emerging, offering a modernized infrastructure that provides faster settlements, lower costs, and greater transparency by leveraging stablecoins like USDC and EURC. CPN connects a global ecosystem of banks and payment service providers to enable real-time transactions, marking a significant improvement over the traditional multi-day processing times, and is poised to reshape the cross-border payment landscape by integrating digital currencies into the regulated financial system efficiently and securely.