Building Solutions for Cross-Border Payments

Utilizing a Stellar-based service for cross-border transactions You can transfer money internationally by using standard instructions. It's an easy and efficient method to conduct B2B payments. Stellar is a replacement for the international wire and currency conversion which makes transactions more efficient and quick.

The Problem


In standard B2B transactions the service provider determines the method by which they wish to be compensated. It's a protocol that is bank-to-bank that requires the customer to cooperate with their bank in order to transfer payment . The bank of the correspondent transforms their currency and determines the exchange rate, and also charges fees.


The settlement time is usually 2 to 5 business days according to the countries as well as the banks that are involved. Banks also charge high fees of 6 percent because of the multitude of intermediaries in the financial system.


The Solution


The development of a solution for international cross-border payments, Stellar eliminates the cash and time problems that arise from traditional B2B transactions. Stellar allows financial institutions to process the same transaction within minutes at a fraction of one cent and avoid excessive exchange rates and bank charges.


Combining the advantages of a blockchain-based, frictionless method to pay through a local partner Stellar provides on- and off-ramps to all currencies around the world. Local partners can also be identified as anchors, which are used to shift anchors around the Stellar network, while also paying out and accepting traditional currencies within their region.


The benefits of using blockchain in cross-border transactions


No middleman


Blockchain eliminates the need for intermediaries, correspondents or central authorities for payment processing. The transactions are made between two parties who have signed a joint agreement, which guarantees that the trust of the ecosystem.


Reducing turnaround time


Because there are no middlemen or central authorities involved in the processing of payments, the time to process is shorter for settlements and funds is transferred more quickly across boundaries.


Security


Since the information for the transaction have been encrypted and hashed the transaction cannot be altered. alter the information. Modifying one block within the chain makes the other blocks invalid, by altering their hash value.


Read More : https://www.leewayhertz.com/stellar/cross-border-payments-solutions/

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