Today, nearly every trade transaction in the world is facilitated by global payments, with J.P. Morgan estimating that around $200 trillion
in payment flows occurred last year. Yet despite the scale and digitalization of finance, the core infrastructure still works on slow and fragmented rails. As a result, for many firms, especially in emerging markets, a simple cross-border transfer can still
take weeks to settle, costing time, money, and opportunities.
In other words, data quickly moves across the world, but money doesn’t. While that gap may seem minuscule at first glance, every delay
impacts liquidity, weakens competitiveness, and often excludes smaller exporters from global value chains. So, if trade is the engine of growth and payments are its fuel, that fuel is now at risk of running dry. The real question is whether the system can
advance fast enough to keep up with the pace of global commerce.
The Cost of Friction
In fact, the deeper issue behind global payments’ slowness is that it acts like an invisible tax on every business moving money through
borders. Each day a transfer is delayed, liquidity freezes, and working capital quietly loses value. Yes, for large corporations, it’s a minor hit to efficiency; for small firms, it’s existential, as delays can mean the difference between surviving and closing
the doors.
This is especially acute in emerging markets, where settlement still takes 30, 60, or even 90 days. Imagine a furniture maker in Vietnam
selling about $100,000 of goods each month and waiting months to be paid. On just a single invoice, given an 8% cost of capital (a figure of the financing rate
typical
for SMEs in developing markets), that delay turns into over $1,300 in lost value. Moreover, when that repeats with every shipment, small businesses end up working with thin margins and significantly lacking cash.
Beyond “slow” money, opacity, and fragmentation, or rather, lack of interoperability, add another complexity layer. Most firms can’t
see where a payment is or what it will cost until it reaches its destination, as fees change en route, foreign exchange (FX) spreads widen without warning, and compliance checks stall a payment for days. Meanwhile, payment rails rarely synchronise because
systems in various countries and banks work on different standards, APIs, principles, and protocols. This means every cross-border payment is forced to pass through several intermediaries, each adding cost and delay.
Together, opacity and poor interoperability build a maze where only the biggest players can find a way out, while smaller firms get
lost inside, paying more and waiting longer. In my view, this is a substantial drag on global trade, instead of being just a minor inconvenience. Still, solutions already exist and they lie in new rails designed for visibility, speed, and true connectivity
that are already here.
Bridging the Islands of Money
Since the rails need re-engineering, embedded finance is at the
forefront of how businesses are changing the way they
move money. By integrating payments, FX, and credit directly into ERPs, procurement platforms, and marketplaces, businesses can settle invoices almost instantly instead of waiting 30–90 days. Here, the result is tangible, as cash that used to idle in receivables
is now released immediately, giving firms the liquidity to restock, hire, and grow without taking on expensive new debt.
Then come the telco-fintech partnerships that extend financial rails through regions such as Africa and Asia, where mobile reach
exceeds bank access. In many of these markets, traditional
banks simply can’t reach small businesses, so telcos stepped in to fill the gap, using their infrastructure, agent networks, and customer data to onboard millions who were previously unbanked. So, when fintechs add the missing pieces (clearing, FX, and compliance),
this collaboration turns basic mobile connectivity into a viable financial ecosystem that finally includes the smallest players in global trade.
In turn, regulators couldn’t ignore this progress, and, if anyone expected them to slow it down, to their surprise, they did the opposite.
Across key markets, authorities
launched regulatory sandboxes and testbeds that let
firms measure risk and test new models in live conditions. In Southeast Asia, six such programs are already active, while in the UAE, ADGM and DIFC frameworks have become regional benchmarks. This dispels the myth that regulation is a hurdle to growth, as
in reality, it often accelerates it.
From where I stand, global payments can no longer afford to move more slowly than the trade they power. The invisible tax of slow, opaque
payments costs SMEs real money and the ability to compete. Those who act now to reengineer payments will free working capital, create jobs, and boost exports, while those who delay, risk leaving entire regions outside the modern trade forever.
