The future of wire: Analyst perspectives on modernization and global transactions
Wire transfers have been a cornerstone of global commerce for a long time—making swift and secure movement of funds across borders possible. Traditional wire systems face inefficiencies such as a lack of transparency, high costs, and slow processing times, driving many banks and credit unions to consider modernizing wire transfers and cross-border payments as an important part of payments modernization overall. In a conversation between Datos Insights and Alacriti, Robin LoGiudice, Strategic Advisor with the Commercial Banking & Payments team at Datos Insights, provided perspective for the ongoing challenges, emerging trends, and strategic innovations shaping the future of wire transfers and cross-border transactions.
Most financial institutions rely on a vendor to handle wire processing, enabling better customer interactions. However, if the vendors aren’t innovating in the space and offering better solutions, negative experiences will persist. Datos Insights’ research identified the biggest points of friction when it comes to cross-border payments.
Current challenges in wire transfers for customers:
- Lack of transparency and high costs: One of the most significant issues in wire transfers, especially cross-border ones, is the opacity regarding fees and charges. Customers often face unexpected costs due to hidden fees and fluctuating exchange rates. And there is no consistency in pricing, even on the receive side of a wire. This lack of transparency can deter users from utilizing wire transfers and push them towards alternative methods of payment.
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