India must rethink cross-border payments beyond corridors, put customers first: Deloitte
A shift from corridor-led expansion to customer-centric design forms the core principle needed to drive the next stage of India's cross-border payment ecosystem, according to a report by Deloitte.
New Delhi: Deloitte's report suggests India must transition from corridor-focused cross-border payment systems to a customer-centric approach for future growth. The document outlines that future policy, digital infrastructure, and regulatory platforms must be reshaped around distinct user groups instead of generic, corridor-oriented rollouts.
While India has established a robust foundation for global competitive cross-border payments, the next stage of development hinges on the principles guiding policy, infrastructure, and ecosystem choices.
As cross-border payments progress towards continuous, interconnected networks, discussions will transition from payment speed and cost to other critical issues. These include determining liability for fraud across jurisdictions, managing cross-border data sharing and localization requirements, overseeing tokenized settlement networks, and developing mechanisms to ensure real-time beneficiary credit without compromising settlement certainty.
The Deloitte report identifies four key principles to guide this evolution. It recommends default interoperability throughout the transaction lifecycle, the creation of an open digital ecosystem with shared infrastructure, maintaining transparency by default, and prioritizing customer outcomes alongside payment connectivity and transaction processing.
To realize this vision, the report proposes several measures. These include developing tailored payment journeys for various sectors, such as exporters, MSMEs, gig workers, multinational corporations, travelers, and remittance users, who each face unique payment, compliance, and documentation challenges. Additionally, the framework advocates for interoperable payment systems integrated with regulatory bodies like customs, GST, DGFT, EDPMS, and IDPMS through standardized APIs, reusable digital data, and reduced duplicate reporting.
Shared infrastructure components involve expanding API-based access to digital infrastructure platforms (DPI), creating reusable digital identity and Know Your Customer (KYC) frameworks, and maintaining proportionate, risk-based oversight. Transparency requirements encompass standardizing fee and foreign exchange margin disclosures, offering end-to-end tracking, and enhancing settlement predictability.
While the goal is to expedite cross-border payments, the primary focus is on fostering an ecosystem where exporters can receive payments more swiftly, digital earners can participate globally with minimal friction, and remittance users receive greater value from each transaction. By integrating interoperable DPI with coordinated regulation, open ecosystem participation, and customer-centric innovation, India can create the digital infrastructure needed to support a USD 1 trillion export economy this year, expand towards a USD 2 trillion economy over the next five years, and enable a digital economy expected to contribute nearly 20 percent of GDP by 2030.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
