- The cross-border payments industry is expected to reach $250 trillion by 2027, as Ripple, Stellar, Swift, etc. vie for dominance.
- This industry is reported to have grown by $25 trillion to $150 trillion between 2018 and 2022.
The battle for supremacy in the cross-border payments industry reaches new levels as Stellar, Ripple, Cardano, Hedera, Swift and FedNow redouble their efforts with innovations. According to a report, the industry grew by $25 trillion to over $150 trillion between 2018 and 2022. This is almost the entire size of the global technology industry in 2023. As a report shows publication by Crypto News Flash, stakeholders expect the sector to grow to $250 trillion by 2027. Other reports link the growth rate to investments focused on trade and infrastructure projects such as the African Continental Free Trade Area and China’s Belt and Road Initiative. This reportedly adds 10% to the annual growth of cross-border payments from emerging economies.
According to Tanja Haase, head of Swift Go, the bank is still the point of contact for all cross-border transactions, as shown in a study that included input from 4,000 consumers and SMEs.
Swift’s attempt to lead the industry was recently reflected in the Central Bank Digital Currency (CBDC) interoperability experiment, which is in an advanced stage. As disclosed by the company, more than thirty financial institutions have experimented with the solution.
The beta solution has taken the next step, with three central banks and monetary authorities, including the Hong Kong Monetary Authority (HKMA) and the National Bank of Kazakhstan, integrating the solution with their infrastructure for direct testing.
Ripple, FedNow and Stellar are revolutionizing the cross-border payments industry
While Swift aims to dominate the sector, it also seeks to ensure the coexistence of CBDC, fiat and other payment systems. Interestingly, Swift faces stiff competition from Ripple and Stellar Lumens. Recently, Ripple announced a strategic partnership with global e-commerce giant Amazon to integrate XRP into its payments business.
Experts believe that XRP’s dominant involvement in cross-border payments could drive its token price to $500 by 2027. Likewise, Stellar’s focus on faster and cost-effective transactions positions it as a fierce competitor to lead the industry.
What sets the Stellar network apart from other blockchains is its interoperability. The Stellar Network can interoperate with other blockchains and traditional financial infrastructure through regulated financial institutions called anchors. may issue assets and/or offer on- and off-ramps on the Stellar network.
Hedera, another blockchain project, appears to be one of the fastest growing platforms with instant settlement time and the ability to process 10,000 transactions per second. Transaction fees on Hedera cost less than 1¢ USD and the fees are fixed.
Beyond these projects, FedNow, an instant payments system launched by the US Federal Reserve in 2023, is already growing its presence within the ecosystem. Immediately after its launch, 35 banks and credit unions announced their support, along with the Bureau of Fiscal Service of the Ministry of Finance. Although sign-up is optional, the service is available to more than 10,000 U.S. financial institutions. It is also the first American real-time payment system.
