Banks and regulators must do more to achieve FSB cross-border payments targets
Banks are calling for greater cooperation from regulators as they address demands for cheaper and faster cross-border payments.
In October 2021, a Financial Stability Board (FSB) report set out global quantitative targets for addressing the challenges of cost, speed, transparency and access faced by cross-border payments. One of the key targets was that the global average cost of retail payments should be no more than 1% by 2027. The FSB has said it will publish initial estimates of the key performance indicators (KPIs) required to meet this target in October.
The cost of supporting cross-border payments is not trivial and banks must invest substantial resources to make it work efficiently. They are also leveraging initiatives such as Swift Go and Immediate Cross-Border Payments (IXB) – the latter a joint venture between EBA Clearing, The Clearing House and Swift – to limit the cost of payments.
ISO 20022 will help to streamline and automate some of these processes thanks to rich and structured data, but that will not be enough
However, the target outlined above will not be reached without public authorities exploring the way in which the finance industry must control every payment, suggests Nicolas Cailly, head of payments and cash management at Societe Generale global transaction and payment services.