The interoperability challenge: Why payments must work across borders

Sending a WhatsApp message around the world is instant. Sending money? It can still take days. Costs pile up, processes remain fragmented, and friction builds at every step. At the root of the problem is a lack of interoperability between payment systems around the world.

As cross-border trade and digital economies evolve, interoperability is a cornerstone of economic growth.

For money to move as easily as information, payment networks must speak the same language. That means enabling different systems and currencies to connect seamlessly, moving funds instantly, securely, and transparently.

The building blocks of interoperability

Interoperability is essential for fast, efficient, and reliable cross-border payments. To achieve it, a wide range of systems, technologies, and stakeholders must be seamlessly aligned across jurisdictions. Money cannot move smoothly across borders unless several core components operate as a cohesive whole.

First, local real-time payment (RTP) systems and regional payment networks must function effectively within their domestic environments to support international connectivity. These systems form the foundation for cross-border integration.

The technical infrastructure that underpins these systems, including disparate software platforms, APIs, and messaging formats, must be able to exchange data accurately and consistently.

Effective interoperability also hinges on regulatory alignment. Compliance with Know Your Customer (KYC), Anti-Money Laundering (AML), and data protection laws must be achieved in real-time and across borders, which requires close coordination between governments, regulators, and service providers. This requires both adoption of standards and coordination among regulators.

When these elements are misaligned, the result is fragmentation, characterised by slower transactions, higher costs, and reduced reliability. Interoperability ensures that every part of the payments ecosystem can connect, communicate, and operate effectively, paving the way for a smoother global financial experience.

Why interoperability matters

Interoperability allows payment systems to exchange and process transactions with one another. Its impact is far-reaching:

For businesses, faster settlements, lower costs, and streamlined operations make international growth more accessible. For consumers, faster, cheaper and more transparent remittances improve financial inclusion and trust. And for regulators, standardised data improves oversight, enhances transparency, and simplifies compliance.

JP Morgan estimates that cross-border payment volumes will surpass $290 trillion by 2030, highlighting the urgent need for interoperable solutions.

What’s holding interoperability back?

The benefits of interoperability are clear, but getting there is far from easy. Today’s cross-border payment systems face multiple layers of friction rooted in outdated infrastructure, regulatory complexity and a fragmented technology landscape.

Here’s what’s standing in the way:

• Legacy infrastructure: Many national payment systems were built decades ago, tailored specifically for domestic use. These systems often rely on outdated technology that wasn’t designed for global connectivity, causing inefficiencies, delays, and friction in cross-border transactions.
• Regulatory fragmentation: Compliance requirements such as Know Your Customer (KYC), Anti-Money Laundering (AML), and data privacy vary widely across jurisdictions. This patchwork of rules complicates onboarding, slows down transactions and raises operational costs.
• Inconsistent standards: The absence of universally adopted messaging standards, like ISO 20022, leads to mismatched data, transaction errors and integration challenges. Without common frameworks, collaboration between financial institutions becomes cumbersome.
• Closed-loop platforms: Many digital wallets and payment platforms operate within restricted geographic or operational ecosystems. These closed loops make it difficult for users to send and receive funds across borders.
• Currency complexities: Managing foreign exchange fluctuations, navigating conversion rates, and routing through multiple intermediaries often result in higher fees and longer settlement times. These inefficiencies only add to the challenge of seamless cross-border payments.
• Emerging digital asset ecosystems add a layer of complexity with new gaps created as adoption rises.

Unlocking global economic growth

Improving interoperability is an economic catalyst. When cross-border payments are fast, transparent and affordable, they unlock greater participation in global trade, drive financial inclusion and strengthen economic resilience worldwide:

• Empowering SMEs: Small and medium-sized enterprises often held back by high fees and slow settlements can tap into new international markets with confidence. Removing friction helps them scale globally and compete on a level playing field.
• Accelerating remittances: Remittances are a critical lifeline for millions in developing economies. Making these flows cheaper and faster has a direct impact on household incomes. According to the World Bank, global remittance flows surpassed $800 billion in 2023, underscoring their importance to economic stability. The G20 has made improving the speed and cost of remittances a core focus, and interoperability is key to achieving that goal.
• Fueling digital platforms: Ecommerce marketplaces, gig economy apps and online service providers rely on seamless global payments to serve users across borders. Interoperable systems enhance user experiences, build trust and drive platform growth.
• Advancing financial inclusion: Connecting underserved communities to global financial networks helps individuals and businesses in emerging markets participate more fully in the digital economy. This creates more equitable access to opportunity and more inclusive economic growth. This includes the use of stablecoins, which can extend financial access to populations underserved by traditional banking, offering fast and inexpensive remittance alternatives through mobile apps and digital wallets.

Building truly interoperable payment networks

Achieving global interoperability requires a holistic approach that brings together infrastructure, compliance, partnerships, innovation as well as the right technology. To connect diverse payment ecosystems, organisations must invest in scalable architecture and build deep, local integrations across markets. The following are key building blocks for enabling truly interoperable cross-border payment networks:

• Modern, scalable infrastructure: Cloud-native platforms capable of processing high transaction volumes across multiple currencies and jurisdictions form the backbone of interoperable networks. They ensure secure, fast, and reliable cross-border payments at scale.
• Real-time settlement: Systems that support instant or near-instant settlement capabilities reduce foreign exchange risk, improve liquidity and enhance operational efficiency, critical for businesses operating across borders. Blockchain-based stablecoins can further accelerate settlement by eliminating cut-off times and providing 24/7 transfer capabilities.
• Standardised compliance: An integrated global compliance framework simplifies KYC, AML and data privacy requirements. This reduces friction, speeds up onboarding, and ensures global regulatory alignment.
• Open, unified APIs: Standardised APIs allow financial institutions, platforms and payment providers to connect with minimal effort, accelerating integration, reducing cost and speeding up time to market.
• Strong local integration: Partnerships with local banks, mobile wallet providers and cash agents are essential to ensure last-mile delivery of funds, even in hard-to-reach areas. Local presence which improves reach, reliability and trust is crucial.

Thunes, the Smart Superhighway to move money around the world, brings these elements together to power seamless, real-time cross-border payments. Our Direct Global Network connects directly to over 7 billion mobile wallets and bank accounts, 15 billion cards and spans more than 130 countries and 80 currencies via more than 320 different payment methods.

With deep local connectivity and a unified global framework, Thunes delivers fast, secure and compliant payments worldwide.

The future of cross-border payments

The path to interoperability is accelerating, driven by global cooperation, standardisation and emerging technologies. International efforts like the G20’s roadmap for enhancing cross-border payments and the adoption of standards such as ISO 20022 are laying the foundation of a more connected financial system. At the same time, innovations such as Central Bank Digital Currencies (CBDCs), stablecoins, blockchain, and artificial intelligence are expected to simplify compliance, strengthen security, and increase transparency across transactions.

Companies like Thunes are helping bridge the divide between legacy systems, such as banks, cards and domestic payment rails, and newer networks, including mobile wallets and emerging digital asset ecosystems. By enabling seamless connections between these traditionally siloed systems, Thunes is making global payments faster, more inclusive, and future-ready.

Interoperability is both a technical upgrade and an economic enabler. It empowers individuals, businesses and regions to fully participate in the global economy, driving inclusion and sustainable growth.

As the digital economy expands, seamless cross-border payment connectivity becomes essential. Closing the interoperability gap will transform how money moves across borders and unlock new economic opportunities around the world.

At Thunes, we’re committed to this mission, connecting payment systems, platforms and people with speed, scale and simplicity.

Contact us to discover how we can help you achieve payment interoperability.