There are more people transacting across borders in larger sums than ever before. This group does not feel bound by borders in terms of lifestyle, access or travel.
According to Flywire, they are spending increasing amounts on goods and services outside their home countries, resulting in dramatic growth in cross-border payments – for education for their children, for medical care, for real estate and for other offerings. Businesses looking to appeal to this growing and affluent segment must take steps to reduce the friction in today’s cross-border payment process.
As large, cross-border payments become more common, consumers are looking for the most convenient, cost efficient and transparent options. This is driving more of these transactions to web and mobile channels vs. traditional agent-based and bank-based options. Web and mobile channels offer the ability to track payments instantly, confirm receipt and better understand the fees involved. The traditional agent-based model, while still sizable, will continue to diminish in importance as Millennials and GenXers gain affluence. Banks are already being forced to consider new forms of service delivery, as legacy models and fee structures diminish in relevance for younger segments who do not consider themselves bound by the banks their parents patronize.
With ever-increasing terror threats and the focus on cutting-off financing sources for nefarious acts, we can expect to see a much greater emphasis on transparency and compliance. Any entity processing large, cross-border payments will need to be able to verify sources and recipients with increasing precision and certainty; ensure strict compliance with anti-money-laundering laws; and be able to provide detailed transaction reporting.
Entities accepting large, cross-border payments in any significant volume will also need to be able to provide ancillary support services related to those payments. With consumers from around the world making large payments in different time zones, 24×7, multi-lingual, omni-channel customer support – including phone, email, chat, text and social media – becomes essential.
Education – in 2014, 4.5 million students from around the world attended schools internationally according to Open Doors. That number is expected to grow to 8 million by 2025. In the US alone, almost 1 million international students from 220 countries spend an estimated $27B in tuition and living expenses. It’s a big business – and getting bigger every year.
International Patient Care – Patients Beyond Borders estimates that the worldwide market for International Patient Care (sometimes referred to as “Medical Tourism”) is at $40 billion today, and growing at a rate of 15-25%. Patients are traveling abroad from all over the world for access to more affordable procedures, shorter wait times, and the latest advancements in medical care.
Flywire, formerly peerTransfer, is a leading provider of high-ticket cross-border payment solutions, connecting institutions on six continents with consumers from around the world. Introduced four years ago as a way for international students to pay their tuition for studies abroad, Flywire is now welcomed by almost 900 colleges and universities.. The company processes payments on behalf of students from 220 countries and territories, in 70 local currencies.
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