What does this research mean for the field?

Overcoming the inefficiencies and limited interoperability of cross-border payments requires proactive public sector intervention to harmonize standards and promote competition, as private actors alone cannot resolve these market failures. Novelty: ClaimNovelty.SYNTHESIS. Consensus alignment: ConsensusAlignment.NEUTRAL.

What question did this study set out to answer?

To examine the structural market failures, technical barriers, and institutional challenges impeding the efficiency of cross-border payment systems compared to domestic networks.

August 27, 2026Annual Review of Financial Economics

Cross-Border Payment Technologies: Innovations and Challenges

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Authors

SCStijn ClaessensYale University TRTara RiceBank for International Settlements

Discussion

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Implication

Economic review reveals key interoperability barriers in cross-border payment systems, indicating that public-sector harmonization is essential to reduce transaction costs and delays.

Key Points

To examine the structural market failures, technical barriers, and institutional challenges impeding the efficiency of cross-border payment systems compared to domestic networks.
Analyzed technological models and structural market dynamics across cross-border payment arrangements, retail transactions, and remittances.
Evaluated institutional disparities, multisided market frictions, and interoperability constraints governing international financial infrastructures.
Identified limited interoperability driven by institutional divergence and multisided market frictions as the primary constraint on cross-border payment efficiency.
Determined that private sector mechanisms alone cannot resolve existing market failures, requiring public sector intervention to harmonize message transmission standards, modernize compliance regimes, and foster competition.

Cite This Study

Claessens et al. (2026) studied this question.

synapsesocial.com/papers/6a8fea0110c91c1e92621fde https://doi.org/10.1146/annurev-financial-111424-022758

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Implication

Economic review reveals key interoperability barriers in cross-border payment systems, indicating that public-sector harmonization is essential to reduce transaction costs and delays.

Cross-Border Payment Technologies: Innovations and Challenges

Discussion

Member takes

Implication

Key Points

Cite This Study

Cross-Border Payment Technologies: Innovations and Challenges

Discussion

Member takes

Implication

Key Points

Cite This Study

Also Consider

Also Consider