Cross-border B2B payments can be challenging, with regulatory differences, language barriers and high global remittance costs.
Regulatory differences increase turnaround times for transactions and negotiations, causing operational costs to go up, Tranglo CEO Jacky Lee told PYMNTS.
Language barriers may cause key points to get lost in translation, so companies need to think about whether they need to support multiple languages.
High global remittance costs — with a fee that stands at an average 6.3%, according to World Bank data cited by Lee — exist because of complexities involved in routing and central intermediaries.
Tranglo has experience meeting these challenges. Founded in 2008, the company helps financial institutions (FIs) and businesses pay globally through Tranglo Connect, its proprietary cross-border payments solution.
In addition to challenges, the company sees these opportunities, Lee said: “high potential in business payment in terms of liberating the global commerce and cross-border B2B payments industry through the use of blockchain technology for greater transparency, security and speed.”
Performing a Comprehensive Cost-Benefit Analysis
Tranglo now supports cross-border B2B payments in 25 countries, including several in Asia, Africa and South America, as well as Australia, Russia and Turkey. When there is substantial demand from current partners for a certain corridor, the company performs a comprehensive cost-benefit analysis.
“The few things we usually watch out for before committing: existing infrastructure and regulatory support, the risk appetite involved, any short- or long-term plans that could potentially affect our operations and enough demand from end consumers,” Lee said.
Typically, a company will approach Tranglo for help because it is finding it time consuming and costly to have to negotiate commercial terms as well as service specification with respective payout partners for each market or corridor that it wants to get…
