Cross border payments at times can be a very lengthy and complicated process. iPiD aims to simplify cross-border payments as easy as a text message. Alain Raes, Founding partner and Chief Commercial Officer at iPiD, in a conversation with Business Today, spoke about how the company plans to make international payments simpler by needing only a simple proxy for the payee’s identity.
BT: Domestic payments in most countries are fast and efficient but in the cross-border space, the payment process remains complicated, and the customer experience is lacking. What according to you is the problem?
There are 2 big problems to solve in the payments. Firstly, it is about making payments faster and cheaper. Secondly, it is about making payments easier, improving customer experience, as well as preventing fraud. We have seen both of these being solved in domestic payments and in cross-border payments, payments are also getting a lot cheaper and faster than it used to be. However, there is currently a lack of interoperability between the domestic overlay data services, which will allow for making cross-border payments simpler.
BT: Are the problems in cross border payments the same across all countries or do they vary?
It is the same problem that we see across different countries when it comes to cross-border payments, simply because they are not able to interconnect to each other. The degree of how easy it is for a particular country to resolve the problems varies, as it depends on many factors such as regulatory restrictions, the level of digital payment adoption, and the development of domestic payment infrastructure. We leverage the existing domestic overlay service and connect them with payment providers around the world to solve the global problem.
BT: Can one envisage a day where a customer can affect cross border payments similar to UPI, at the click of a button? If so, by when and what are the enablers?
The payment space has been constantly evolving and improving. We could only imagine the possibility of an instant real-time payment system like UPI 10 years ago and it is now happening, not only in India but many other countries in different part of the world. If we can truly improve the interoperability among such system and given the support of regulatory authorities, the day where we can make global payments as easy as domestic ones is not too implausible, it may take some time though. It will have to start somewhere.
BT: How is your company making international payments simpler? What is the role of your company in the whole ecosystem?
We talked a lot about speed and efficiency eventually leading to a reduction of costs, but a lot of things can be done to improve the customer experience. And by customer experience, I mean for instance, validating the payee account before doing a cross-border payment, or providing proxy payments, so you can pay internationally with a proxy, like a phone number, a QR code. That does exist already domestically. It doesn't, at the international level. So, our company is focused on making it possible for cross-border payments. At iPiD, we don't do payments, we are providing solutions prior to initiating the payments to ensure interoperability, as far as the data is concerned.
Will E-rupee or CBDC make cross border payments simpler and faster?
CBDC is a way to accelerate the digitalisation of currencies. We have all the systems in the world that support the international payments which is already more advanced than what we used to have before. We didn't look at what has been achieved over the last few years in terms of making payments more efficient, faster, and cheaper. Yet, payments experience has been constantly improved. Will CBDC achieve a lot more? I think the jury's still out. There's a lot of talk about CBDC. To be fair, little is being achieved only through CBDC . For it to replace the system that we have now, it will not be happening overnight.
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