Cross-border payment.

In plain English

A cross-border payment moves value between parties in two jurisdictions, typically converting one currency into another along the way. The traditional route runs through correspondent banking, where your bank holds an account with a bank abroad or reaches one through intermediaries, and every link takes a fee and adds time. Newer providers net payments internally and hold local accounts in both countries, which can shorten the chain to a single step. The true cost is the stated fees plus the exchange rate markup, and the markup is usually the larger half of the two.

01Why it matters

For anyone sending money to family abroad, the difference between a good and a bad provider on the same amount can be several percent, repeated every single month.

02The math, step by step

Say you send 1,000 dollars monthly. Provider A charges 5 dollars plus a 3 percent rate markup, about 35 dollars. Provider B charges 8 dollars plus 0.5 percent, about 13 dollars. Across a year that is 420 dollars against 156 dollars, a 264 dollar difference for identical transfers.

Illustrative example. The amounts here are hypothetical, chosen to show how the math works, not real quoted rates or figures.

03What this is NOT

04Receipts

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