The world of cross-border payments has seen a veritable foundational shift in the last fifteen years. Changes in regulation have allowed the emergence of licensed entities that can operate and innovate outside the space of the traditional correspondent banking world. Payment Service Providers like TransferMate and Wise have brought faster and cheaper cross-border payments to a wide range of clients at the touch of a button.
Correspondent Banks dominated this space effectively for centuries ultimately strangling any form of progress until in the early 2000s regulation in key markets, an example quickly followed by a wide range of jurisdictions, finally broke this deadlock. This meant that organisations like TransferMate and Wise, licenced operators of payment services that from the outset leveraged modern technology, were not held back by legacy limitations and were capable of delivering a vastly improved customer experience. It is this development that moved the world of cross-border payments away from the heavy reliance on correspondence banking.
Peak proliferation of PSPs has been reached and not unexpectedly what we are seeing now is a wave of consolidation and structured collaboration between the strongest survivors. Established PSPs are now seeking ways to get access to new markets without the need to have a license in each of them or fall back on the correspondent network. The strength of the RTGS.global SaaS proposition is that it creates a standardised global platform to structure the workflows that create this access. The end result is a community of service providers in the cross-border payment space of various ilk offering seamless integration across their services.
The resulting interoperability between the aforementioned licensed organisations is both at a transactional level, providing bilateral access to each other’s markets, but crucially also at the level of availability of liquidity pools. Using the RTGS.global FX rate agreement workflow and its ability to instruct cross-currency settlement, Participants have the opportunity to offer access to liquidity pools held within the control of payment organisations without the need to rely on the typical correspondent banks. With settlement executed under the license of the connected payment providers this creates a fully transparent network service operating entirely within the prevailing regulations in each connected jurisdiction. The resulting network powered by RTGS.global unlocks instant, comprehensive and fully transparent workflows for cross-currency and cross-border transactions for financial institutions wherever they are. This is a unique proposition not currently matched in the market.
The market at large, and with it the larger traditional financial organisations, has conceded that Payment System Providers have captured the market for the last mile, but the larger banks continue to have a stranglehold on liquidity pools. By enabling PSPs to access excess funds that result from their day-to-day activity, funding and onward payment to the end beneficiary can be more closely linked, vastly increasing the speed and reconciliation process of the end-to-end payment process. There is no denying that at the offset balancing liquidity needs between participants will be a challenge, but one that will quickly be overcome once the network scales. Improved self-sufficiency in access to liquidity between payment service providers would be a giant leap for all stakeholders involved.
Facilitating the next foundational market evolution
Recognising the trend for consolidation and concentration, RTGS.global has built a SaaS platform that connects financial institutions to transform how cross-border payments are made. With an API supporting standardised point-to-point workflows for FX quote agreement, the instruction of cross-currency settlement and cross-border payment instructions, the platform enables rapid, cost-effective transfers between financial institutions. The straightforward technical integration of the single API is supported by a standardised contractual framework binding all network stakeholders to a common way of working, creating a truly global platform for interconnectivity and interoperability. This combination where innovative use of cloud and API technology innovation of the solution meets a solid framework for collaboration demonstrates the true strength of the RTGS.global proposition. We are confident our partners can leverage this to scale their payment offerings at unprecedented speed.
Some of the key features of the RTGS.global SaaS proposition:
Integrated with Funds Controllers (account providers with access to domestic fast/instant payment systems) in a wide range of currencies
All settlement executed under control of licensed Funds Controllers
Supports Workflows for FX rate agreement and instant payment flows
Will encourage re-use of liquidity within the network as much as possible (without the need to go outside the network)
Platform available 24/7/365 increasing liquidity management opportunities
ISO2022 and FIX standards used for all workflows
Interoperability between all network participants via a single API
Together these advances will facilitate a further move towards instant international payments, with RTGS.global acting as the messaging service. It’s capability for 24/7/365 point-to-point information exchange will result in increased speed, transparency and accessibility of cross-border payments, reducing risk by facilitating (near) real-time reconciliation of cross-border payment flows. It creates commercial opportunities with the potential for newly designed instant payment services. The resulting efficiency translates into reduced cost, further strengthening the users’ competitive position.
RTGS.global’s vision is to be the company that modernises how established payment system operators and other financial institutions interconnect across the globe, opening up avenues for increased liquidity coverage, leverage and management without being beholden to legacy barriers. That’s our commitment. Get in touch today to find out how we can help you.
Dirk Cavens
Chief Product Officer
Correspondent Banks dominated this space effectively for centuries ultimately strangling any form of progress until in the early 2000s regulation in key markets, an example quickly followed by a wide range of jurisdictions, finally broke this deadlock. This meant that organisations like TransferMate and Wise, licenced operators of payment services that from the outset leveraged modern technology, were not held back by legacy limitations and were capable of delivering a vastly improved customer experience. It is this development that moved the world of cross-border payments away from the heavy reliance on correspondence banking.
Peak proliferation of PSPs has been reached and not unexpectedly what we are seeing now is a wave of consolidation and structured collaboration between the strongest survivors. Established PSPs are now seeking ways to get access to new markets without the need to have a license in each of them or fall back on the correspondent network. The strength of the RTGS.global SaaS proposition is that it creates a standardised global platform to structure the workflows that create this access. The end result is a community of service providers in the cross-border payment space of various ilk offering seamless integration across their services.
The resulting interoperability between the aforementioned licensed organisations is both at a transactional level, providing bilateral access to each other’s markets, but crucially also at the level of availability of liquidity pools. Using the RTGS.global FX rate agreement workflow and its ability to instruct cross-currency settlement, Participants have the opportunity to offer access to liquidity pools held within the control of payment organisations without the need to rely on the typical correspondent banks. With settlement executed under the license of the connected payment providers this creates a fully transparent network service operating entirely within the prevailing regulations in each connected jurisdiction. The resulting network powered by RTGS.global unlocks instant, comprehensive and fully transparent workflows for cross-currency and cross-border transactions for financial institutions wherever they are. This is a unique proposition not currently matched in the market.
The market at large, and with it the larger traditional financial organisations, has conceded that Payment System Providers have captured the market for the last mile, but the larger banks continue to have a stranglehold on liquidity pools. By enabling PSPs to access excess funds that result from their day-to-day activity, funding and onward payment to the end beneficiary can be more closely linked, vastly increasing the speed and reconciliation process of the end-to-end payment process. There is no denying that at the offset balancing liquidity needs between participants will be a challenge, but one that will quickly be overcome once the network scales. Improved self-sufficiency in access to liquidity between payment service providers would be a giant leap for all stakeholders involved.
Facilitating the next foundational market evolution
Recognising the trend for consolidation and concentration, RTGS.global has built a SaaS platform that connects financial institutions to transform how cross-border payments are made. With an API supporting standardised point-to-point workflows for FX quote agreement, the instruction of cross-currency settlement and cross-border payment instructions, the platform enables rapid, cost-effective transfers between financial institutions. The straightforward technical integration of the single API is supported by a standardised contractual framework binding all network stakeholders to a common way of working, creating a truly global platform for interconnectivity and interoperability. This combination where innovative use of cloud and API technology innovation of the solution meets a solid framework for collaboration demonstrates the true strength of the RTGS.global proposition. We are confident our partners can leverage this to scale their payment offerings at unprecedented speed.
Some of the key features of the RTGS.global SaaS proposition:
Together these advances will facilitate a further move towards instant international payments, with RTGS.global acting as the messaging service. It’s capability for 24/7/365 point-to-point information exchange will result in increased speed, transparency and accessibility of cross-border payments, reducing risk by facilitating (near) real-time reconciliation of cross-border payment flows. It creates commercial opportunities with the potential for newly designed instant payment services. The resulting efficiency translates into reduced cost, further strengthening the users’ competitive position.
RTGS.global’s vision is to be the company that modernises how established payment system operators and other financial institutions interconnect across the globe, opening up avenues for increased liquidity coverage, leverage and management without being beholden to legacy barriers. That’s our commitment. Get in touch today to find out how we can help you.
Dirk Cavens
Chief Product Officer
