Cross-border Payments Outlook 2022: Trends, Challenges, and Opportunities

As more and more countries open their borders after COVID-19 travel restrictions, the payments industry is undergoing a shift towards more openness as well. The pandemic gave a boost to the global digital economy, accelerated open banking, and increased the need of moving funds across borders when traveling was not possible.

According to the Visa GME study, 87% of global merchant executives see cross-border sales as their biggest growth potential. Cross-border business accounts for nearly a third of their revenue. Modern consumers are constantly looking for better quality, pricing, or products that are unavailable in their home markets.  

In 2022, the global cross-border payments market is expected to reach USD$156 trillion.

How will this development reshape the payment landscape and what can merchants and the providers of financial services do to maximize the opportunities?


Cross-border payment transactions happen when the payee and the payment recipient are located in different countries. These transactions can be between banks, financial institutions, businesses or individuals. The most common types are credit card transactions, bank transfers, or eWallet payments.

Seize the Moment

In their 2021 Borderless Commerce Report, PayPal mentions that this is a unique moment in time when merchants can diversify their business model and tap into cross-border growth. As consumers became more comfortable shopping online, they started shopping globally more often, and this trend will accelerate further.

For fintech companies, the growth of the cross-border payment market brings in opportunities to solve long-standing pain points – high transaction costs for international payments, inefficiency in operations, accessibility, and speed.

If historically, banks were at the center of the cross-border payment market, over the last few years the financial industry has seen a rise in technology-enabled smaller players who offered fast and cost-effective payment solutions, disrupting and developing the market. The variety of new players has caused the cross-border payment landscape to become increasingly fragmented and complex, with companies focusing on different geographies, transaction sizes, and payment segments.

For these new entrants, another opportunity for a market disruption presents itself in targeting low-value transactions in the B2C and B2B segments that are underserved by traditional payment providers.

Follow Trends

There are a few behavioral drivers that are changing the cross-border payments landscape. During the COVID-19 pandemic, consumers moved to shop online and started spending more per purchase, at the same time demanding more from businesses, including speedier delivery and less friction in the buying process.

The adoption of digital wallets has grown hand-in-hand with mobile e-commerce. In 2020, 26.4% of e-commerce payments in Europe were made using a digital wallet, which is the most popular payment method in France, Germany, Russia, Spain, and the UK. This dominance is expected to continue to grow with e-wallets anticipated to account for up to 30% of e-commerce transactions in Europe by 2024. The global digital payments sector is expected to continue its impressive growth in 2021 with transaction values of over $6.6 trillion.

These trends have created the need for more digitally-enabled money transfer operators who offer digital payments as their core business. They establish direct relationships with sending and receiving countries. In regions with more regulations, they work with partners, such as back-end networks.

Another area ready for innovation is international B2B payments. A study from Juniper Research shows that the total value of B2B cross-border payments, which have grown by 30% in the last two years, will reach $35 trillion in 2022. This type of corporate payment is difficult to optimize. Many processes for international B2B payments are still manual. There is friction involved in confirming wire transfers. Foreign exchange rates are constantly changing, and there are security challenges.

New and Long-Standing Challenges

While customers expect fast and frictionless cross-border funds movement, international transactions can amplify the weak spots in local payment networks. Inefficiency and complexity in operations, payment fraud, and data security make the list of the biggest challenges for even the most technology-enabled companies.

Efficient payment orchestration is especially challenging for large companies that serve multiple markets, each with its own regulations and banking landscape. At the same time, smaller businesses struggle with having the sales strategies and resources to tap into the international payments landscape. According to research by Visa, small businesses executives are not as eager to tie their growth strategy to international sales, because a misstep could have greater consequences. It also takes much longer (up to 55%) to receive cross-border payments than domestic payments, which can have negative cash flow impacts on small businesses.

Keeping Cross-Border Payments Safe

Recent research from PYMNTS identified several key pain points for U.S. and U.K. companies engaged in cross-border business. Payment fraud (56%) and data security (54.6%) were the top concerns. Keeping international transfers safe is also challenged by the amount of legal and regulatory requirements that companies have to keep in mind when planning their security programs. 

“The accuracy of fraud detection in both local and international transactions depends on the quality and completeness of the data,” explains Stephen Lazenby, INETCO’s VP, Product Management. ‘If merchants or payment processors have limited data for identifying fraud, they may end up with either too many false positives, or with gaps in their payment security. The good news is it is possible to base fraud detection on complete, unaltered, end-to-end network data without impacting other systems – in real-time.”

Stephen explains that the better approach to fraud detection is to capture data from the entire end-to-end transaction at the network level and leverage the raw, unfiltered network traffic for anomaly detection. When suspicious and fraudulent transactions are detected, individual transactions can be blocked at the field level, based on a variety of different criteria, allowing good traffic through while keeping out the fraudsters.

For merchants and payment providers, expanding into international markets can bring long-term business opportunities and growth. Partnering with third-party providers, whether for improving payment security or increasing efficiency of operations, can make the journey to payment modernization and innovation in this sector faster and easier.

Looking to take your payment fraud prevention strategy to the next level? Book a free consultation with one of our experts to learn how.