A New Era for US Cross-Border Payments

Livia Benisty is Chief Executive Affairs Officer at Banking Circle, leading public policy, regulatory and government affairs. Livia was previously Head of AML for Banking Circle and for Citi’s Trade and Treasury Solutions in EMEA, focused on Correspondent Banking and Digital Payments.

Recent policy discussions and efforts to expand competition, resilience, and participation within U.S. national payments systems mark a pivotal moment for the future of cross-border payments. These conversations create an opportunity to modernize how American banks and businesses — particularly small and mid-sized enterprises (SMEs) — engage with the global economy. More broadly, they reflect growing recognition that U.S. payments infrastructure must evolve to keep pace with technology-driven change, improve efficiency, and reinforce the long-term strength and global relevance of the U.S. Dollar. To do this, we must maintain a focus on safety and compliance, while broadening access to national payments systems for well-regulated, eligible institutions that choose not to engage in traditional bank deposit and lending activities.

Empowering American Banks & Business

For decades, cross-border payments have been characterized by complexity, opacity, and cost. Providing fast, transparent, and global payment services requires substantial investment in technology, compliance systems, and foreign exchange banking capabilities. These demands have disproportionately burdened smaller and mid-sized banks, and frequently required them to partner with less than a handful of large national banks capable of facilitating cross-border payments. The lack of diversity and competition in banking entities offering robust cross-border payment capabilities has limited the ability of smaller financial institutions to compete and constrained the services they can offer their business customers. Consequently, many American businesses, especially those looking to export their products and services, have faced unnecessary friction, delays, and higher costs when sending or receiving funds internationally. 

The costs of this status quo are not abstract. When banks are unable to serve customers’ cross-border needs, businesses are forced to rely on a narrower set of large global intermediaries or seek alternatives outside of their primary banking relationships. This dynamic concentrates activity, reduces competition and places smaller firms at a disadvantage in global markets. Over time, these frictions erode the competitiveness of U.S. businesses and limit the ability of American banks to grow alongside their customers.

Payment Modernization Will Boost Trade

Modernizing the cross-border payments ecosystem offers a clear path forward — this means supporting efforts to increase approvals for direct and comprehensive access to national payment systems. Today, eligible financial institutions focused on payments services are often blocked from such access in part because they do not look like a legacy bank. Yet, granted access, such institutions can partner with and enable smaller bank customers to access sophisticated international payment capabilities without duplicative infrastructure investment, while maintaining appropriate risk management and compliance standards. By expanding participation of such eligible institutions in national payments systems — many of which hold banking charters and are subject to the same safety and soundness expectations as legacy deposit-taking banks — modernization efforts hold promise in expanding access to efficient, dollar-denominated cross-border payments and introducing greater competition into a space long dominated by a small number of global institutions. 

Most importantly, the benefits of modernization flow directly to American businesses. Imagine a small manufacturer in the Midwest, eager to export specialty goods to Europe or Asia. Faster, more predictable, and more cost-effective international payments improve cash flow, reduce working capital strain, and give SMEs greater confidence to engage in cross-border trade.  These improvements are especially meaningful for smaller firms, for whom payment delays or unexpected costs can materially affect operations. At scale, these efficiencies support U.S. exports, job creation, and economic growth.

Strong Payments, Strong Dollar

Beyond immediate commercial advantages, payment system modernization holds strategic importance for the United States and the U.S. Dollar. In a rapidly evolving global financial landscape, upgrading the infrastructure upon which the Dollar transacts through expanded participation and competition is paramount to maintaining its preeminent status. By facilitating faster, more reliable, competitive, and secure dollar-denominated cross-border transactions, the dollar's utility and attractiveness as the world's primary reserve currency and medium of exchange is reinforced. This strengthens U.S. financial leadership and provides a stable foundation for global trade and investment.

The convergence of policy attention, technological capability, and global competition makes this a defining moment for U.S. payments infrastructure. The question is no longer whether modernization is needed, but whether the United States will move decisively enough to ensure its payments infrastructure keeps pace with the rapidly changing global economy.

The opinions shared in this article are the author’s own and do not reflect the views of any organization they are affiliated with.

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