Victor Orlovski is founder of R136 Ventures, a Silicon Valley-based VC firm focused on scaling mid- and late-stage B2B and fintech startups.
The global B2B payments market, valued at $1.10 trillion in 2023, is set to double, reaching $2.11 trillion by 2032, propelled by advancements in financial technology and the broader adoption of mobile wallets.
But as the sector expands, businesses face a host of challenges: from stringent compliance requirements to the need for robust security measures to protect sensitive payment data. The shift toward regionalism and local priorities over global cooperation adds further strain, complicating transactions across international borders and increasing the demand for more flexible payment infrastructures.
In this landscape, traditional economic alliances are being reevaluated, and the once-dominant influence of the United States in global payments is diminishing, prompting a reimagining of how businesses transact on a global scale.
Reimagining Global Payment Infrastructure For A New Era
As a venture capitalist embedded in the fintech sector, I have observed firsthand the transformative impact geopolitical and economic shifts are having on global commerce. I believe my experiences investing in and developing innovative financial technologies help provide a unique perspective on the complexities and evolving needs of global payment systems.
Given this, I believe it is imperative for business leaders to not only stay informed but also actively contribute to the evolution of global payment infrastructures. Our insights and strategic decisions can shape the future of cross-border transactions, ensuring that emerging alternatives—such as a BRICS-led payment network, regional currency cooperation and blockchain technology—are effectively integrated.
Challenges Shaping The Future Of Cross-Border Payments
Rapid deglobalization and increased focus on local over international interests continue to reshape cross-border transactions. These shifts are pronounced in the complex web of compliance regulations, which differ from region to region, raising both the cost and time required to complete transactions.
Not only does the diminishing role of the U.S. in global payments exacerbate these challenges, but so does the unreliable nature of traditional trade finance systems in developing markets, which I see as crumbling under these pressures. New, agile payment solutions can help navigate this fragmented financial landscape.
Innovative Strategies To Reshape Global Transactions
BRICS-Led Payment Infrastructure
I think a promising approach is the development of a BRICS-led payment infrastructure tailored for the developing world, one that operates independently of the U.S. dollar and U.S. banking transit. This would mitigate the reliance on traditional Western financial networks and reduce transaction delays and compliance complexities.
However, establishing this system poses significant challenges. It requires the creation of a stable reserve currency accepted by all member states and the formulation of uniform regulatory rules, which could take considerable time to negotiate and implement.
Blockchain-Based Options
In parallel, I think blockchain-based solutions present an alternative that could revolutionize cross-border transactions. Despite their potential, major economies such as China, India, Russia and Brazil have been hesitant to fully endorse cryptocurrencies due to concerns over their volatility and regulatory implications.
For things like cryptocurrencies to be a viable solution in trade, they must achieve stability. Paradoxically, most stablecoins are currently pegged to the U.S. dollar, which continues to tie them to the very currency system they aim to replace. The United Arab Emirates is launching its digital currency linked to the United Arab Emirates dirham (AED). While a good example, I believe the AED market is too small to provide a critical mass to become a universal exchange media for international trade.
For investors navigating the payments space, several blockchain-based approaches emerge. To overcome challenges like regulatory uncertainty, though, I think a more balanced approach involves investing in companies that leverage blockchain technology without focusing on cryptocurrencies.
Major financial institutions like Visa and Mastercard have developed blockchain-enabled solutions (Visa B2B Connect and Mastercard Send) that facilitate global transactions.
Streamlined Remittances
Beyond these broader systemic solutions, there are targeted approaches within cross-border payments. For example, I see the remittance sector, plagued by high commissions and stringent anti-money laundering regulations, as ripe for disruption.
The global labor and talent markets face similar challenges, with freelancers and remote workers navigating cumbersome payment processes. I see platforms like Deel.com as helping to pioneer solutions that facilitate smoother transactions for international freelancers, addressing issues from currency conversion to compliance.
Similarly, Stripe now offers merchants the ability to make payouts through USDC stablecoins. In trade finance, platforms like we.trade and Marco Polo use blockchain to automate and secure supply chain transactions, helping to reduce fraud and inefficiencies.
The virtual goods economy, which includes freelancers, gamers and digital creators, operates in a complex cross-border environment. In this sector, I see companies like Unlimint or Xsolla as poised to expand their services in this area, providing robust payment solutions that cater to the unique needs of digital and borderless businesses.
When taking all of these illustrative examples, I see a pattern where each platform is focusing on removing friction from international payments through:
1. Streamlined compliance processes that automate regulatory checks across multiple jurisdictions.
2. Multicurrency accounts that reduce foreign exchange costs and delays.
3. API-first architectures that enable seamless integration with existing business systems.
4. Specialized solutions for particular industry verticals (e.g., digital goods, gaming, freelancer payments).
The key insight is that successful payment platforms are starting to specialize in specific industry verticals rather than attempting to offer one-size-fits-all solutions. By addressing the unique needs of sectors like digital content creation, gaming or international freelancing, you can deliver significant value through integrated payment infrastructure tailored to specific use cases.
Navigating A New Era In International Payments
As we stand at the crossroads of a rapidly deglobalizing world, the future of international B2B payments hinges on our ability to implement innovative solutions. I see the rise of digital platforms and startups that focus on remittances and freelance payments as highlighting a shift toward more decentralized and flexible payment solutions.
Developing this infrastructure will require a cooperative international effort, technological advancement and robust regulatory frameworks. As leaders within finance and venture, I believe we have a unique opportunity to foster innovations and support solutions that can solve complex financial challenges and drive a more inclusive and efficient international payment landscape.
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