A client may confirm that payment has been sent on Monday, yet the money may only arrive by Thursday or Friday. In some cases, even the banks involved struggle to explain where the payment is delayed.
The gap between “payment sent” and “money received” is one of the oldest problems in cross-border banking, and despite major advances in digital payments, it still persists today.
The reason lies in how cross-border banking systems still operate.
The long route behind international transfers
Unlike domestic bank transfers, international payments usually do not move directly between two banks. Instead, they pass through a network of correspondent and intermediary banks before reaching the final destination.
The SWIFT network, widely used for international banking, primarily functions as a messaging system that allows banks to exchange payment instructions securely. The actual movement and settlement of funds often happens separately through correspondent banking relationships built over decades.
That means a transfer may move through multiple financial institutions, across different jurisdictions and currencies, before it reaches the receiver.
Each institution in the chain may conduct its own compliance reviews, sanctions screening or reconciliation checks. These steps are routine in global banking, but they can also add time and unpredictability to transactions.
According to the Bank for International Settlements (BIS), cross-border payments remain slower, costlier and less transparent than domestic payment systems because they involve multiple intermediaries operating across fragmented regulatory and banking frameworks.
Why payment timelines vary
One of the biggest frustrations for businesses is inconsistency.
A payment from the same client, sent through the same bank, may arrive in two days one month and four or five days the next. Often, the sender has limited visibility into where the delay occurred.
Movin Jain, co-founder of Skydo, a cross-border payments platform, says the unpredictability comes from the number of independent institutions involved in a typical transaction.
“In the legacy SWIFT flow, multiple intermediary banks may run their own compliance review, work on different timelines and reconcile transactions independently,” he says.
Factors such as banking cut-off hours, time-zone differences, additional verification checks or local holidays can all affect settlement timelines.
For smaller exporters and freelancers who rely on steady cash flow, even short delays can create operational uncertainty.
Why visibility often breaks down
Tracking a domestic delivery today is relatively straightforward. International bank transfers, however, still offer limited visibility in many cases.
Once a payment leaves the sender’s bank, it may move through systems that do not fully share real-time updates with one another. As a result, the receiver often does not know:
- where the funds currently are,
- what deductions may apply,
- or when the final amount will arrive.
While improvements such as SWIFT gpi have increased payment tracking capabilities in recent years, visibility still depends heavily on how participating banks share information with customers.
“Good visibility means knowing where the money is, how much will be received and when it will land,” Jain says.
For many smaller businesses, the lack of clarity around fees and timelines remains a larger concern than the transfer itself.
The hidden cost beyond transfer fees
Cross-border payment costs are not always limited to the upfront transfer charge.
Depending on the payment route, businesses may face intermediary bank deductions, inward remittance fees and foreign exchange markups that become visible only after settlement. For exporters handling frequent lower-value transactions, these costs can accumulate over time.
Documentation is another challenge in India’s export ecosystem.
Exporters often require Foreign Inward Remittance Advice (FIRA) or Foreign Inward Remittance Certificates (FIRC) for compliance, taxation and audit purposes. Delays in receiving these documents can create additional administrative work for businesses already managing tight payment cycles.
How newer payment models are evolving
Over the past few years, fintech firms have attempted to simplify parts of the cross-border payment process by reducing dependence on long correspondent banking chains.
Many newer platforms now collect funds locally in the sender’s country, process foreign exchange digitally and settle payouts domestically in India. The aim is to improve predictability, reduce intermediary involvement and provide clearer visibility into fees and settlement timelines.
Experts say demand for these models has grown alongside the rise of India’s freelancer economy, software exporters and remote service businesses, many of which depend on smaller but frequent international transactions.
At the same time, global regulators and banking networks continue to explore ways to modernise cross-border payment infrastructure. The broader push across the industry is focused on improving speed, transparency and interoperability without compromising compliance standards.
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