With the development of technology, cross-border trade gradually entered people's lives. We no longer need to go abroad to buy overseas goods. Placing an order online through cross-border e-commerce or a buyer's agent is becoming much easier. Now, three main ways are used by customers to purchase overseas goods: personal shopping, cross-border shopping, and cross-border e-commerce. The most standardized model is to use cross-border e-commerce. The final and most critical step in all business is payment. After completing the payment, the current order can be successfully completed.
Now, cross-border e-commerce is experiencing an explosive growth. The popularity of outbound travel and study abroad has brought new challenges to payment. How to achieve cross-border payment? Many payment companies have announced the launch of cross-border payment services.
So, what is cross-border payment? First of all, from the literal meaning of "cross-border," such payment scenarios have spatial characteristics. For example, the purchase and payment process of a product in cross-border e-commerce is actually: payment (buyer) + settlement (seller).
The import mode includes a domestic buyer and a foreign seller, while the export mode is on quite the opposite. We just need to clarify the relationship between the two parties, and the information flow and fund flow will be clear, as shown in the table below.
From the table, we can see that the currencies used by the two parties are different. The main problem to be solved is to collect payment and to make the settlement of remittances. For buyers, for example, if payment is made in local currency RMB, the payment channel should have an international payment license and be able to collect RMB. If payment is made in foreign currency (USD), the channel then should be able to collect USD ,and of course, have an international payment license, such as XTransfer. From the seller's perspective, if the buyer pays in local currency of himself (RMB), then RMB needs to be converted into USD; if the buyer pays in seller’s local currency (USD), then USD needs to be converted into RMB. This process of convertingthe two currencies is called exchange, and we need to rely on certain third-party collection agencies to complete it.
