Cross-border remittances are a lifeline for many developing countries, but high fees and long turnaround times can make timely payments difficult for those who may least be able to afford delays. Some consumers are now turning to cryptocurrencies as a payment option that allows them to send payments quickly and securely.
PYMNTS research shows that many consumers (24%) see the ability to send funds in cryptocurrency, in fact, as the main motivation when choosing a payment service provider (PSP).
In The digital currency shift: the report on cross-border transfers, a PYMNTS and Stellar Development Foundation Together, we will announce the results of a survey among 2,079 participants in 2021. The study shows how the need for affordability and convenience affects the way consumers send and receive cross-border payments. Payment service providers offering alternatives to traditional transfer methods could experience increasing interest from consumers who want to avoid high fees and extended processing times.
PYMNTS research found that 70% of consumers pay a fee to send money overseas, with variable fees averaging 6.2% and fixed fees averaging $ 14.80. The largest percentage of peer-to-peer (P2P) payments were sent to friends or family who were in dire economic straits due to the pandemic (32%). For these consumers, long payment delays and high transaction fees can have a significant impact on their access to the funds they need or on the payer’s ability to transfer the total amounts they intended.
Consumers looking for alternatives have switched to cryptocurrency as an option. Cryptocurrency has become an accepted payment method with many retailers and is available through many PSPs.
PYMNTS research found that 23% of respondents – representing 8 million adults – who made online payments to friends or family in other countries used at least one type of cryptocurrency. In fact, 13% of consumers surveyed said cryptocurrencies were their most common payment method for online cross-border transfers. Fifty-one percent of those who send cross-border payments now own at least one type of cryptocurrency.
Despite the appeal of new, more convenient options like cryptocurrencies, PYMNTS research found that consumers were choosing PSPs to send their transfers on a trust basis. The study found that for all P2P payment options, trust is the deciding factor when consumers choose a payment service provider (PSP). 56 percent of consumers cite trustworthiness as a factor that increases the likelihood of choosing a particular provider. Consumers define trust in different ways. More than half of respondents said that having a recognizable brand name increases their confidence in choosing a payment service provider for cross-border transfers (53%). 
According to the survey, consumers also valued transaction security (47%) and the remitty’s ability to access funds quickly (41%) as a factor of trust. Since most (59%) consumers who send wire transfers have increased the amounts sent in the past year, fees and waiting times can affect customer loyalty. Payment service providers need to weigh the impact on customer loyalty if fast and affordable alternative payment methods are not available.
To learn more about how cryptocurrencies affect the customer experience for transfer senders, download the report.
source https://www.bisayanews.com/2021/09/24/cryptocurrencys-sway-on-cross-border-payments/
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