APAC faces growing need for cross-border payment, research reveals

By Divya Shah

Why it matters: The study highlights cross-border payment challenges in APAC, including India’s high fees, transfer delays and interoperability gaps.

Key takeaways

• Singapore led the region: It ranked first among 15 APAC markets, followed by Australia and South Korea.

• India faced cross-border payment friction: More than half of surveyed senders paid fees above 3%, while many recipients experienced delays exceeding three days.

• Domestic and international connectivity differed: UPI supported strong domestic adoption, but international payment links remained limited.

Asia-Pacific has made progress in digital payments, but fragmented payment networks and limited cross-border connections continue to create friction for consumers and businesses, according to the Cross-border Interoperability Index: Asia Pacific research by Thunes and Juniper Research. 

The research assessed 15 Asia-Pacific markets across five dimensions: economic health, digital infrastructure, financial inclusion, cross-border connectivity, and market dynamics and progress. Singapore ranked first in the region and second globally, with an overall score of 8.3, followed by Australia at 7.5 and South Korea at 7.2. India ranked ninth regionally, with a score of 5.5. 

The findings highlighted a gap between the region’s progress in domestic digital payments and its ability to support seamless international transactions. Differences in payment infrastructure, limited connections between domestic payment networks and reliance on intermediaries continue to affect transfer costs, speed and accessibility. 

India recorded strong scores in financial inclusion and market dynamics, reflecting the adoption of digital payments and progress in payment innovation. However, its digital infrastructure score remained relatively low in the index, indicating gaps in broader population-level access and participation. 

The research identified India as one of the most challenging markets for cross-border payment experiences among the surveyed countries. It found that 54% of respondents sending international payments from India paid fees exceeding 3% of the transaction value. Meanwhile, 46% of those receiving international payments said transfers typically took more than three days. 

The findings contrast with the domestic performance of the Unified Payments Interface (UPI), which enables instant bank-to-bank transfers through a common payment infrastructure. While UPI has supported widespread digital payment adoption, international person-to-person connectivity remains limited. The research noted that further connections with major remittance markets, including the United States and Europe, could help address this gap. 

The Philippines offered a contrasting example. Around 33% of respondents receiving international payments reported that funds arrived instantly, while partnerships between mobile money providers and international remittance networks helped improve payment speed and access to digital wallets. 

The research highlighted the role of integrations with domestic real-time payment systems, including the Philippines’ InstaPay, in enabling faster payouts. It suggested that partnerships between mobile money operators and international payment providers could offer a model for other markets with significant mobile wallet adoption. 

For banks and FinTech companies, the findings point to opportunities in connecting domestic payment rails, digital wallets, mobile money networks and international payout infrastructure. Such integrations could reduce reliance on fragmented payment routes and improve the speed, cost transparency and reach of cross-border transactions. 

The research also examined stablecoin adoption across the region. India recorded the highest usage among the three surveyed Asian markets, with 23% of respondents saying they had used stablecoins. However, their use for payments remained limited: only 2% reported using them for international payments and 1% for domestic transactions. 

The findings suggested that limited merchant acceptance, conversion challenges, scam concerns and regulatory uncertainty continued to restrict their use as a payment method. 

Regional initiatives could also help improve connectivity. Project Nexus, led by the Bank for International Settlements, aims to connect domestic instant payment systems, including UPI, Singapore’s PayNow and Thailand’s PromptPay through a shared platform. However, the research noted that differences in regulatory requirements, including anti-money laundering rules, could affect implementation. 

Overall, the research indicated that the next stage of digital payment development in Asia-Pacific will depend not only on expanding domestic payment infrastructure but also on connecting existing systems across borders. For banks and FinTech providers, interoperability will remain important to delivering faster, more accessible and cost-effective international payment services.