Embedded Finance Revolutionising Cross-Border Transaction

Delivery

This report comes in PPT.

Key findings

Pandemic boosted e-commerce, while border reopening stimulates travel/ migration

Cross-border retail e-commerce witnessed more than 25% year-on-year growth, thanks to border restrictions during the pandemic.

From 2022 to 2023, along with scrapping of travel restrictions, travel and migration have been recovering, motivating financial institutions to roll out new travel and remittance products.   

Trade wars and real wars disrupting trading and investment

International supply chain and FDI have been greatly impacted by the trade wars and conflicts, especially between the two superpowers, increasing the complexity and expense.

In an era with increasing uncertainties, investors demand profit growth trajectories, while investment has been increasingly concentrated within the top 10 markets.

Card operators expanding to digital solutions

Card operators such as Visa, Mastercard and UnionPay have been offering personal and commercial cards, enabling banks to issue cards for cross-border transaction.

They have been stretching to digital payments (fast transaction and QR payment, etc), to capture embedded finance opportunities with banks and remittance firms.

Digital challengers targeting underserved and unbanked

Challenging incumbents, FinTechs including Ant Group, Wise and Stripe have been focusing on agile and low-cost digital cross-border transaction solutions.

They focus on digital banks and digital wallets, which in turn target long-tail consumers and businesses, requiring highly automated solutions involving a few incumbent banks and operators.