Cross-border settlement times vary across the globe

• Even if Cross-border settlement can take as little as 5 minutes (depending on routes and other factors), each settlement requires pre-funding in thedesired currency
• The pre-funding times are not captured in the In-flight and Beneficiary times and can be significant
• The capital pre-funding requirement not only delays the settlement but drives the Liquidity portion of the total transaction cost up
• Capital control is usually imposed by local regulators and linked to liquidity
• Bank offline hours indicates high level of attended or manual processing

High average cost of transaction is unavoidable in legacy processing

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1. Steep and growth of X-Border payment volumes.
2. Volume concentration of “clean” (STP)
3. Avoidance of exception handling, liquidity management, and claims and treasury operations.
4. New approach for fraud, anti-money laundering, and straight-through processing.
5. Rise of new highly automated FMIs with low margins.
6. Redesign of many incumbents’ businesses and historical contracts.

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