Given that 41% of cross-border payment startups are utilising crypto, the future of cross-border payments could very well be going in that direction. The data originates from FXC Intelligence, a cross-border payments data and intelligence company that recently released its most recent industry analysis.
According to FXC Intelligence, the number of startups offering cross-border payment services exclusively to corporate clients has been increasing at a far quicker rate than that of startups servicing consumer clients. Only 26% of the businesses it examined were primarily focused on consumers, with the majority, or 74%, catering to corporations.
Although business-to-business (B2B) cross-border payments became the most popular emphasis, many also offer services that let businesses work with firms that deal with cryptocurrencies, either to accept payments from clients or to conduct business with them. In some capacity, 41 per cent of the startups offered cryptocurrency products.
The state of the market may have an impact on this, since investment was more likely to go to businesses that included cryptocurrency in their offering. As a matter of fact, 57% of the companies got investment, while just 39% of the companies did not have any product related to cryptocurrencies.
Comparably, businesses with a business focus had a higher likelihood of funding (53% of them having obtained money as opposed to just 27% of businesses with a consumer focus).
Business-focused startups with cryptocurrency products were the most likely to have gotten investment, accounting for 59% of all startups; consumer-focused startups without cryptocurrency products were the least likely to have received funding, at 19%.
“A potential evolution of the industry in brief”
“We’re interested in analysing these startups because it provides a snapshot of how the industry may evolve in the future,” stated Lucy Ingham, editor-in-chief and head of content at FXC Intelligence.
“It doesn’t paint a perfect picture of payments’ future, but it does show who the new businesses that will support the sector’s expansion are.
We can learn a lot about how the industry is evolving by looking at the problems these companies are concentrating on resolving. These insights include the breakthroughs and technology that will influence the way money is moved in the future as well as the major macro obstacles the sector is trying to tackle.
“There are signs that the business side of payments will be the primary area of growth in the industry, which is reinforced by the robust growth rates of more established players in this space.”
The next two most popular areas of focus, after crypto interoperability, were process improvement for business or consumer customers, with many businesses concentrating on particular markets.
On the corporate side, this means making some business corridors more affordable or efficient and enhancing services in developing markets; on the consumer side, it means addressing financial inclusion and lowering transaction costs.
This approach is comparable to that of many other well-established companies in the field and illustrates the variety of chances for process improvement present in the worldwide cross-border payments market. Due to factors like market size, local infrastructure, or market maturity, many of the businesses concentrating on this sector are situated in regions of the world that have historically been viewed as too difficult or of lesser priority.
