Singapore Cross-Border Payments Frictions Cost Firms USD7bn a Year

Singapore businesses lose an estimated USD7bn annually because of inefficiencies in traditional international payment systems, according to research by Airwallex and the Centre for Economics and Business Research.

The Singapore cross-border payments study found that payment failures, foreign-exchange spreads, correspondent banking fees and settlement delays continue to impose significant costs on companies.

The report described these inefficiencies as a “Global Growth Tariff”, with payment failures and manual repair processes alone costing Singaporean businesses around USD420m each year.

The Singapore cross-border payments challenge also results in approximately USD220m of working capital being tied up at any given time because of delayed settlements.

Globally, the study estimated that around USD330bn of working capital remains trapped within the financial system, reducing liquidity and increasing operational costs for businesses engaged in international trade.

The findings highlight growing demand for faster, lower-cost payment infrastructure as companies seek to optimise cash flow and cross-border operations.