Cross-border payments in 2040: five hypotheses for a multi-rail future

For much of the past five decades, cross-border payments appeared to be moving towards greater global integration, common standards and convergence around a small number of dominant infrastructures. But that assumption is now being tested.

New payment systems, new forms of money, geopolitical fragmentation, regulatory divergence and advances in artificial intelligence (AI) are creating multiple possible futures for cross-border payments. Some point towards greater interoperability; others towards greater fragmentation.

"Banks will increasingly need to coordinate activity across multiple networks, payment methods and forms of money simultaneously"
Jonas Stepczynski, Head of Market Management, Institutional Cash Management, Deutsche Bank

So, how will these developments shape correspondent banking by 2040? This white paper explores five hypotheses that are likely to shape the direction of cross-border payments over the next 15 years.

Each section comes with a clear view as to what this might mean for FIs as we approach 2040, and what is needed to navigate these potential changes. While the hypotheses point to different directions of travel, one theme is consistent throughout the paper: the future value of correspondent banking will lie less in owning a particular rail, network or technology.

“Banks will increasingly need to coordinate activity across multiple networks, payment methods and forms of money simultaneously,” explains Jonas Stepczynski, Head of Market Management, Institutional Cash Management, Deutsche Bank, who authored the paper’s foreword. “We will continue to act as the connective tissue within this evolving ecosystem, deploying the right infrastructure and technologies for the right use cases to best serve our clients, while orchestrating across multiple payment environments on their behalf.”