Money & Finance › Payments & money movement
Cross-border payments: moving money between countries
· Concept
Fact, law or dataA rule, statute, definition or measured number.
Sending money abroad passes it through a chain of banks, a currency conversion and two countries' rules.
See it on the Money & Finance map →How it works
A US firm paying a supplier in Seoul tells its bank to wire won or dollars. The bank sends a SWIFT message; money moves through accounts banks keep with each other (correspondent accounts), sometimes via two or three banks, each taking a fee. Someone converts currency at a spread over the market rate. Sanctions and anti-money-laundering checks can hold a payment for days. Typical small-payment cost: $25–50 in wire fees plus 1–3% in exchange spread. Paid wires are rarely recalled.
Why it matters
It is slower and costlier than domestic payment, which is why the G20 set 2027 targets for speed and cost and why stablecoins and new links compete for it.
Facts, rules and data
BIS and Financial Stability Board reports on the G20 cross-border roadmap, World Bank remittance-price data (over 6% to send $200 in 2024), and SWIFT statistics.
Debates and risks
Whether stablecoins, links between instant-payment systems such as Project Nexus, or upgraded correspondent banking will cut costs fastest is an open contest.
Inside this (3)
Connections (7)
▸Cross-border payments: moving money between countries link national Payment rails: how money moves from account to accountFact, law or data
The connection
Each country has its own rails: Fedwire and ACH in the US, BOK-Wire+ in Korea. A cross-border payment hops from one domestic system to another through banks holding accounts in both, with SWIFT carrying the instructions. Newer links connect instant-payment systems directly to cut those hops.
When and why
Worldwide; the G20 roadmap since 2020 and the BIS's Project Nexus aim to link national systems.
How we know
BIS Committee on Payments and Market Infrastructures reports describing correspondent and system-to-system links.
Debates and risks
Whether direct links between instant systems, such as Singapore–Thailand and India–Singapore, can scale beyond a few country pairs is uncertain.
▸SWIFT: the bank messaging network carries the messages for most Cross-border payments: moving money between countriesFact, law or data
The connection
A US company's bank wiring dollars to Seoul sends a SWIFT payment message naming the beneficiary's bank and any intermediaries. SWIFT moves no money; banks then settle through correspondent accounts. Its gpi tracker, since 2017, lets senders follow a payment along the chain like a parcel.
When and why
Worldwide since 1977, linking over 11,000 institutions; payment messages moved to the richer ISO 20022 format by November 2025.
How we know
SWIFT's annual reports and traffic statistics, and BIS studies of correspondent banking.
Debates and risks
How much China's CIPS and other systems will reduce SWIFT's role, especially for sanctioned countries, is debated.
▸Correspondent banking: nostro and vostro accounts is the backbone of Cross-border payments: moving money between countriesFact, law or data
The connection
Most international payments are chains of correspondent accounts. A Los Angeles importer pays a Seoul supplier: the US bank debits the importer, sends a SWIFT message and credits the Korean bank's dollar account, or routes through an intermediary that holds one. Each link adds a fee and a compliance check, which is why international wires cost more and can arrive short.
When and why
Worldwide, centered on New York for dollars; SWIFT, founded in Belgium in 1973, carries the payment messages.
How we know
BIS and Financial Stability Board reports on cross-border payments, and SWIFT data on payment routing and speed.
Debates and risks
Whether faster alternatives, such as linked instant-payment systems, stablecoins or central-bank platforms, will bypass correspondent chains or simply plug into them.
▸Cross-border payments: moving money between countries must convert currencies at Exchange rates and currency marketsFact, law or data
The connection
Unless both sides use the same currency, someone converts. Banks quote a rate with a spread over the market rate: often around 0.1% for big firms, but 2–4% on small payments. Example: sending $10,000 to Korea at a 2% markup costs about $200 on top of wire fees.
When and why
The currency market trades about $9.6 trillion a day (BIS, April 2025), much of it tied to payments and hedging.
How we know
The BIS Triennial Survey, and rates that banks and transfer firms must disclose to consumers under the CFPB's 2013 Remittance Rule.
Debates and risks
Whether hidden exchange markups should be disclosed on business payments too, as they are for consumers, is debated.
▸Remittances and the 1% US remittance tax (2026) are the retail side of Cross-border payments: moving money between countriesFact, law or data
The connection
Remittances are the small, frequent end of cross-border payments: often a few hundred dollars from a worker to family. Transfer companies collect in the US, pay out abroad from pre-funded local accounts, then settle with partners in bulk through correspondent banks, so a single $300 transfer rarely moves as its own wire.
When and why
The largest US corridors run to Mexico, Central America, India, the Philippines and China; UN and G20 goals aim to cut average costs to 3% by 2030.
How we know
World Bank remittance data, CFPB remittance-rule exams, and G20 and Financial Stability Board progress reports on cross-border payment targets.
Debates and risks
Whether the 3% cost goal for 2030 is reachable when averages sat around 6% in the mid-2020s.
▸Trade finance and payment guarantees: getting paid safely manages the risk in Cross-border payments: moving money between countriesFact, law or data
The connection
A cross-border payment for goods carries extra risk: the buyer may not pay, the goods may not arrive, or a government may block the currency. Trade finance ties payment to documents. A letter of credit, sent by SWIFT, makes the importer's bank, not the importer, promise to pay once shipping papers arrive.
When and why
Worldwide trade; banks exchange letters of credit and collection orders by SWIFT messages such as the MT700.
How we know
International Chamber of Commerce rules (UCP 600, URC 522) and SWIFT trade-message statistics.
Debates and risks
Whether digital bills of lading and trade platforms will finally cut the paper and delays, promised for decades, is still uncertain.
▸Stablecoins: crypto tokens pegged to a currency offer a 24/7 route for Cross-border payments: moving money between countriesMainstream view
The connection
Instead of a chain of correspondent banks, a sender buys dollar stablecoins, sends them over a blockchain in minutes on any day, and the recipient converts them to local currency or keeps dollars. Network fees can be cents, but cashing in and out, and local rules, add cost and friction.
When and why
Widely used in Latin America, Africa, Turkey and Southeast Asia; the US GENIUS Act of July 2025 set rules for issuers.
How solid is the link?
On-chain data, Chainalysis and BIS reports, and payment firms' disclosures of stablecoin settlement.
Debates and risks
How much stablecoin volume is real payments rather than crypto trading, and how anti-money-laundering rules will apply abroad, is uncertain.