What happened
- Specific facts/numbers: BIS Working Paper No 1385, published on 19 October 2026, compares three rails for cross-border payments—traditional banks using correspondent banking and SWIFT, fintech money transfer operators, and stablecoin-based transfers—and finds fintechs such as Wise, Remitly and Western Union’s digital arm have materially lower all-in costs than retail bank wires.
- Institutions involved: The Bank for International Settlements published the paper, authored by Wenxin Du, Catherine Huang and David Scharfstein; the firms named in the study include Wise, Remitly and Western Union’s digital arm, alongside traditional banks using SWIFT.
- Regulatory/technical context: The BIS frames the work around persistent frictions in cross-border payments despite improvements in digital financial infrastructure, with the paper specifically measuring harmonized all-in costs across bank, fintech and stablecoin rails and highlighting that stablecoin transfers still involve intermediary and execution frictions rather than offering a seamless substitute.
- What to watch next: Watch for whether policymakers or market participants use this BIS evidence to push further cross-border payment reforms or changes in retail remittance pricing; beyond the paper’s publication, no specific next milestone was identified.
Why it matters
The study suggests that cheaper cross-border transfers are currently coming more from fintech distribution and pricing models than from stablecoin rails, which matters for banks, remittance providers and policymakers trying to lower retail payment costs.
HKMA Relevance
Direct: The BIS has issued a concrete recent publication on cross-border payments, a core payments-policy area that falls within the HKMA’s remit and would plausibly inform its work on payment system efficiency and cross-border rails.