Breaking the "Impossible Triangle" of Cross-Border Payments

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Source: Beijing Business Today

On March 26, during the Boao Forum for Asia Annual Conference 2026, a sub-forum with the theme of “Building a Diversified Cross-Border Payment System” was held, where participants engaged in in-depth dialogue on how to break through the bottlenecks of traditional cross-border payment models, seeking a balance between efficiency, cost, and security through diverse technologies and regional cooperation. One consensus reached at the forum was that true breakthroughs do not lie in pursuing a “single sprint” for any specific metric but in building a diverse, symbiotic, and interconnected ecosystem.

Seeking a balance point in the “impossible triangle”

“Cross-border payment has three goals: efficiency, cost reduction, and security. Typically, we can only achieve two of these goals, so how can we achieve all three together? It’s very difficult,” said Zhu Feng, Chief Economist for China at JPMorgan Chase, candidly while moderating the forum. For a long time, cross-border payments have relied on an agency banking model, which has a long chain, many intermediaries, and extended settlement periods, resulting in a user experience that is far less convenient than domestic payments.

Faced with this challenge, the participants shared their explorations and practices from different perspectives. Dong Junfeng, Chairman of China UnionPay, vividly compared global trade to the “great rivers” of the world economy, while the payment clearing system is the “riverbed where the water flows quietly.” “When the riverbed is stable, the water flows smoothly,” he pointed out, noting that the current hundred-year global changes are accelerating. Compared to the traditional path of relying on multiple layers of financial institutions and single currency settlements, the global cross-border payment system is undergoing a profound transformation, showing a diversified development trend propelled by new markets, new technologies, and new business formats.

Dong Junfeng shared three new characteristics of the emerging diversified cross-border payment system: first, the regional characteristics represented by “South-South cooperation” are becoming increasingly prominent, with emerging markets in Southeast Asia, South America, and Africa cultivating local digital payment systems, shifting the focus of cross-border payment reform from traditional developed markets to global southern markets; second, emerging technologies are closely integrated with cross-border payments, with central bank digital currencies, blockchain networks, artificial intelligence, and blockchain technology accelerating their application; third, the participation of new infrastructure and widely interconnected models are becoming increasingly clear, with efficient integration of QR code payments, digital wallets, and existing payment networks becoming a reality.

Zhou Xiaochuan, former Governor of the People’s Bank of China and Vice Chairman of the 12th National Committee of the Chinese People’s Political Consultative Conference, pointed out that a good cross-border payment system is centered on the word “system,” rather than any specific technology or performance. “Diversity is normal; other aspects of the market economy are the same. But at a certain stage of diversified development, there must also be a certain degree of interconnectivity and interoperability among the diversities. Without it, users will feel confused and inconvenienced.”

He further proposed that the evaluation of a diversified cross-border payment system must also have diverse indicators; it cannot be determined superior simply by one technical metric “outperforming.” “It’s a bit like needing a person with overall good health to do work; it’s not that a single champion can manage the entire system well.” Zhou Xiaochuan emphasized that the evaluation system’s indicators must reflect “adaptability,” meaning the degree of matching between system performance and user needs, ensuring user satisfaction while meeting macro-control and regulatory requirements.

Qiu Han, Senior Vice President and CEO of PayPal China, supplemented the understanding of the “impossible triangle” from a business perspective. She pointed out that payment services have extended from “the moment of payment” to end-to-end integrated solutions, involving scenarios such as installment payments, dispute resolution, and return arrangements.

“When you pay, it is not the end of the transaction; it’s the beginning of all the work.” Qiu Han also emphasized that the complexity of compliance is often underestimated; different countries have their own requirements for different goods, making it very difficult for a single solution to cover all countries. Regarding cost issues, she believes, “Cheap is a relative concept; it also depends on what items are included in the price.” If payment institutions bear the responsibility for fraud compensation, the cost structure will naturally differ.

How to build interconnectivity and mutual trust

On the basis of exploring diverse paths, the participants further discussed how to consolidate these scattered efforts into a sustainable ecosystem. Many guests emphasized that diversity does not equal fragmentation, and interconnectivity and interoperability are key under a diversified symbiotic pattern.

Sourisa Tanuon, Deputy Governor of the Bank of Laos, expressed his deep feelings about this. In sharing his country’s experience, he pointed out: “If we develop different systems but do not know how to connect them, it will create huge problems. The same principle applies to domestic and cross-border payments—it’s interoperability.” In his view, it is based on this key principle that Laos has been able to achieve leapfrog development in cross-border payments within just a few years from unifying domestic standards to regional interconnectivity.

Zhou Xiaochuan also pointed out while responding to questions about how to promote regional mutual trust that, while the Chinese government has always firmly supported multilateralism, the promotion of multilateral models in the payment field still faces practical obstacles: first, the dynamic development of technical discussions makes consensus hard to reach; second, competition among countries and market entities is fierce.

“But I believe that multilateralism can propose an advanced and attractive ‘template’ that makes others willing to join after seeing it; at the same time, this template must have greater compatibility and interoperability, and it doesn’t have to pursue a 100% unified standard but rather establish an inclusive system that allows for mutual conversion,” Zhou Xiaochuan emphasized.

“Global cross-border payments are moving toward a new era of diversified symbiosis. UnionPay will uphold its original intention of serving the people and, with a more open posture, build a comprehensive cooperation matrix across regions, businesses, and fields with all parties in the industry,” Dong Junfeng envisioned in his speech, stating the need to find the greatest common divisor in standard co-construction and interconnectivity, weaving a global network with system compatibility, and jointly building a diversified symbiotic payment landscape and a value community of mutual interconnectivity and trust with partners.

Beijing Business Today reporters: Yue Pinyu, Zhou Yili

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