.svg)
Structural, regulatory and technical barriers continue to delay progress, with reliance on legacy correspondent banking networks and authorities’ cautious approach hampering the interconnection of systems.
The Financial Stability Board’s (FSB) new progress report acknowledges that despite years of international policy work and the achievement of significant milestones under the G20 Roadmap for Enhancing Cross-Border Payments, end-users continue to see minimal real-world benefit.
The initiative was launched in 2020 to make cross-border payments faster, cheaper, more transparent and more accessible.
The FSB warned that the extensive reforms “have not yet translated into tangible improvements for end-users at the global level,” despite most planned policy measures now being completed.
“It is unlikely that satisfactory improvements at the global level will be achieved in line with the 2027 Roadmap timetable,” the FSB said. It added that “more needs to be done at the regional and jurisdictional level” to translate international policy work into real-world benefits.
The G20 Roadmap was first developed under Saudi Arabia’s presidency in 2020, with the FSB tasked with coordinating efforts across global standard-setting bodies.
In 2021, the G20 endorsed a set of quantitative targets for faster, cheaper and more transparent payments, most of which are due to be met by the end of 2027.
“The FSB and South African G20 Presidency remain committed to achieving the goals of the Roadmap and urge the public and private sectors to make tangible improvements to domestic payment systems as the first and last mile of a cross-border payment depend on domestic payment rails”, said Lesetja Kganyago, governor of the South African Reserve Bank and co-chair of the FSB Cross-border Payments Coordination Group.
In the report, the FSB urges national authorities to take “practical steps” to implement measures that deliver downstream improvements for consumers and businesses. It also calls on private sector stakeholders to “explore and implement changes to improve the end-user’s cross-border payments experience.”
Uneven progress
The report was published jointly with the Bank for International Settlements’ (BIS) Committee on Payments and Market Infrastructures (CPMI) and other partner organisations. This is the first time that the FSB’s annual progress update has been consolidated with its key performance indicators (KPIs) report.
Among recent milestones, the FSB highlighted recommendations to level the playing field between bank and non-bank payment service providers (PSPs) and to address data-related frictions in cross-border transactions.
It also noted that the Financial Action Task Force (FATF) has revised its standards on payment data transparency, specifically Recommendation 16, to improve the flow of information in cross-border payments.
The FSB said that although the global speed of wholesale payments has improved, paving the way for faster retail transactions and remittances, the overall pace of progress remains uneven. The average cost of remittances, a key indicator tracked by the G20, is still high in many regions, even as transaction speeds have increased.
The board, which coordinates the work of national financial authorities and international standard setters in 24 member jurisdictions, said it will continue working with its partners and key stakeholders to support local-level implementation of the roadmap.
Over the coming year, the FSB and other partner organisations will focus on enhancing monitoring and supporting implementation of the agreed policy recommendations under the G20 Roadmap.
“We are committed to facilitating implementation of agreed policy recommendations and to engage actively with the private sector, G20 and non-G20 jurisdictions to make this happen,” said Fabio Panetta, governor of Banca d’Italia, and chair of the CPMI and co-chair of the FSB Cross-border Payments Coordination Group.
The challenge for governments and regulators
It is unsurprising that the G20’s ambitious 2027 targets for faster, cheaper and more transparent cross-border payments are unlikely to be met, given the structural, regulatory and technical barriers that continue to slow tangible progress.
Although regulatory frameworks such as the upcoming third Payment Services Directive (PSD3) in the EU and the UK’s Consumer Duty require financial institutions to provide more transparency in areas such as remittances and FX, the milestones in the G20 targets remain distant.
“While digital platforms and neo-banks offer faster, more user-friendly services, they still depend on legacy correspondent banking networks burdened by entrenched fees and slow settlement cycles,” said David Patrick, head of payments strategy at RedCompass Labs.
Patrick recommended that “governments should focus on harmonised standards and open access, letting technology and competition drive innovation, rather than constraining them through conflicting national rules.”
“The industry is still dependent on correspondent-bank networks built in the 1970s,” said Mike Walters, CEO of Form3. “These are costly, opaque and full of friction, requiring banks around the world to hold multiple nostro accounts, bear liquidity costs and patch legacy cores with ‘band-aids’ just so they can talk to each other.”
Another challenge is regulatory fragmentation. “Each jurisdiction imposes its own rules on data protection, anti-money laundering and capital movement, often with limited interoperability, which adds friction instead of efficiency,” said Patrick.
“National regulators play an essential role in maintaining trust and stability, but their mandates are domestic, making global coordination difficult. Greater regulatory alignment, not simply more regulation, is required if we are to reduce costs and improve efficiency,” he added.
Aligning requirements across dozens of countries, each with its own legal, regulatory and supervisory regimes, remains a complex and time-consuming task.
As the FSB has repeatedly highlighted, interoperability between data frameworks is critical but difficult to achieve, as national data sovereignty laws and local compliance obligations often conflict with global harmonisation efforts.
“Regulators, banks and the FSB all have a part to play when it comes to improving cross-border payments, but their responses have been characterised by caution and resistance to a full infrastructure overhaul,” said Walters.
“While the FSB sets high-level expectations, it cannot take concrete action across borders. Regulators are understandably cautious about capital flows, foreign exchange volatility and systemic risks; and banks resist wholesale disruption of their margins and the effort of rewriting decades of infrastructure.”
Regional disparities mean that while some markets have rolled out efficient domestic fast-payment systems, efforts to connect these systems across borders have lagged.
“If the G20 wants to reduce costs, the next move must be to harmonise regulation, mandate real-time settlement across jurisdictions, and perhaps most importantly, build open and resilient cross-border rails. We need infrastructure that can scale safely, 24/7, without legacy single points of failure,” said Walters.
