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FedACH® Services

FedACH<sup>®</sup> Services

Meeting cross-border payment needs today and tomorrow

June 2011

The importance of cross-border payments is expected to grow, according to a March 2011 survey conducted by the Federal Reserve Banks where a sample of financial institutions were asked about their current and future plans for use of cross-border payments. Approximately 200 financial institutions participated in this survey, which was a follow-up to a similar study conducted in 2009.

The results of the survey highlight the overall growth trends toward global payments. “The survey results confirm what we’ve been hearing informally from customers for years,” stated Elizabeth McQuerry, assistant vice president at the Federal Reserve Banks’ Retail Payments Office. 

 “We’re excited to see continued growth projected for cross-border payments and welcome our customers’ feedback as we develop solutions to meet their anticipated needs.”


Elizabeth McQuerry, Assistant Vice President
Federal Reserve Banks’Retail Payments Office 

And the survey says…

Two-thirds of all survey respondents process cross-border transactions today, as compared to only one-third in 2009. Of those responses, one half said they process business-to-business cross-border payments and the other half said those payments were for consumer-to-consumer purposes. Cross-border payment users also said they make recurring and one-time business-to-consumer payments and consumer-to-business payments as needed.

As the graph below indicates, wire transfers remain the most popular option for business-to-business cross-border payments, noted by 86 percent of cross-border payment users in the survey. Another 43 percent utilize cross-border automated clearing house (ACH) payments and 39 percent use checks. ACH payments showed the most significant growth of the various cross-border payment types, nearly doubling since the 2009 survey. Wire transfers grew by a more modest 17 percent, while use of checks for cross-border payments dropped from 46 percent in 2009.


ACH nearly doubled

Usage of wire transfers and ACH payments for cross-border B2B payments has increased since 2009, while usage of check decreased and purchasing cards remained about the same. 

The survey identified those regions of most interest to customers, today and in the future. About half of those surveyed consider Canada and Mexico to be the most important payment regions today, followed by Europe, China or Japan, noted by a third of the survey participants. Europe and China are expected to be the most important regions for business account-to-account cross-border payments in the future, while China and Central America were named as the most important regions for consumer account-to- cash cross-border payments.

New product development was another important area covered by the survey. Nearly all (86 percent) of survey participants said they would be interested in utilizing electronic data interchange (EDI) information for cross-border ACH payments. Consumer person-to-person remittances were also a topic of interest highlighted by survey participants: half of all respondents said they would be interested in implementing an ACH consumer remittance program.

Finally, the survey asked participants to weigh in on training needs. More than three quarters (76 percent) of survey participants listed guidance on compliance issues as a key concern. Participants said they are also interested in training on related NACHA ─ The Electronic Payments Association® and foreign country rules as they implement a cross-border payment program.

The Federal Reserve Banks regularly seek input on development of services and are evaluating survey results to help assess training needs and guide future enhancements. If you need additional information about our FedGlobal® ACH Payments, please contact your FedACH sales specialist.

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