Although the pandemic has halted the development of tourism and other cross-border industries, the trend of cross-border payments is unstoppable. Online cross-border payments such as global e-commerce and online education are in thriving under new conditions.
1. What is a cross-border payment?
Cross-border payment refers to an international transfer of funds between two or more countries or regions. Consequently, mostly occurs with international trade and international investment. In other words, people in one country consume goods and services from another country. But because they use a different currency, they first need to use a settlement tool or payment system to convert the currency and complete the transaction.
2. The milestones of the cross-border payment industry
Here are the important milestones that made the cross-border payment industry what it is today.
- SWIFT: the earliest cross-border payment
SWIFT refers to The Society for Worldwide Interbank Financial Telecommunication. Established in 1973, it provides a secure and standard network for financial institutions to communicate. The SWIFT language is still used among global banks and facilities for international settlement.
- Visa: the largest credit card international organisation
Perhaps you’re more familiar with Visa because you’ve seen the logo everywhere in the shops and on your bank cards. Shockingly, Visa does not issue bank cards. Instead, it’s a network. Once you join the Visa organization, the bank card can utilise its global transaction processing network. Consequently, through Visa’s payment network, individuals around the world can conduct safe and fast electronic remittance services.
- MasterCard: the second-largest credit card international organisation
Similar to Visa, MasterCard ranks second as a card organisation. Additionally, it was the first organization to expand global networking services in China.
- Paypal: giant third-party payment provider
3. Four cross-border payment patterns between China and UK
Lastly, Union Pay, WeChat Pay and Alipay (the latter two as third-party platforms) are rising stars in the China-UK cross-border payments. They rival traditional methods like wire transfer (normally using SWIFT) and international card organization (Visa and MasterCard). For a detailed introduction to these payments (WeChat Pay, Alipay and Union Pay) you can visit our blog as follows:
- Alipay Introduction: Everything about Alipay
https://www.globepay.co/2020/02/25/alipay-introduction-everything-about-alipay/
- Everything You Need to Know about WeChat and WeChat Pay
https://www.globepay.co/2019/12/17/everything-you-need-to-know-about-wechat-and-wechat-pay/
- Why do we recommend China UnionPay for your business?
https://www.globepay.co/2020/04/06/why-we-recommend-china-unionpay-for-your-business/
As the official partner of Alipay, WeChat Pay and Union Pay, Globepay offers fast, transparent and low-cost cross-border payment solutions. Please feel free to contact us for more information!
