Complexity is often the default setting for business-to-business (B2B) payments, especially cross-border.
But the industry is moving toward greater simplicity and automation thanks to innovations like embedded finance, seamless API-based integrations, and artificial intelligence (AI)-driven workflows that collectively promise to eliminate friction and align systems.
And with the announcement Thursday (Nov. 21) that Mastercard’s Multi-Token Network (MTN) has connected with JP Morgan’s Kinexys digital payments to streamline cross-border B2B transactions, leveraging blockchain for better payments is a priority for B2B companies operating internationally.
The partnership enables the transfer of value in real time, reducing time zone friction and settlement delays – a critical development for industries operating 24/7 supply chains.
Kinexys is a blockchain-based payments platform that uses money from commercial banks for real-time value transfers, while MTN is a set of blockchain-based tools and standards designed to facilitate innovative business models . The integration of these two platforms allows joint customers to settle their transactions faster and more efficiently through a single API, reducing the complexity and time constraints often associated with cross-border payments.
“For years, Mastercard and Kinexys by JP Morgan have been committed to innovating for the future of digital assets and commerce infrastructure. By combining the power and connectivity of Mastercard’s MTN with Kinexys Digital Payments, we unlock greater speed and settlement capabilities for the entire value chain,” said Raj Dhamodharan, Executive Vice President, Blockchain and digital assets at Mastercard, in a press release.
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Improving the efficiency of cross-border payments
The integration of JP Morgan’s blockchain with Mastercard’s capabilities addresses long-standing challenges in B2B payments, including time zone friction, settlement delays and limited transparency. By enabling joint customers to settle their transactions through a single API, the partnership reduces operational complexities and accelerates payment processing across borders.
The move aligns with broader industry trends that emphasize the importance of speed and efficiency in global commerce, while also reflecting the growing importance of interoperability in the ecosystem payments.
“Blockchain technology, and public blockchains in particular, open up a number of new use cases, one of which is transferring value…from one country to another,” Dhamodharan told PYMNTS in a previous interview.
And as PYMNTS pointed out, a consensus is slowly but surely building among industry experts that blockchain technology and new infrastructure could transform the future of cross-border payments.
“Blockchain solutions and stablecoins, I don’t like to use the term crypto because it’s more about FinTech, they found market fit products in cross-border payments,” Sheraz Shere, GM payments and commerce at Solana Foundation , says PYMNTS. “You get disintermediation, you get speed, you get transparency, you get extremely low cost. »
For example, PayPal will begin allowing its disbursement partners to use PayPal USD to settle cross-border money transfers. The new service will be offered through PayPal’s Xoom cross-border payments business, according to a press release issued Tuesday (Nov. 19). Philippines-based financial services company Cebuana Lhuillier and Africa’s Yellow Card are early adopters.
Learn more: How AI and blockchain innovations are reshaping cross-border commerce
Unlocking new use cases in B2B payments
Blockchain technology, once synonymous with cryptocurrencies and speculative trading, is finding a more robust – and potentially transformative – application in the world of B2B payments.
The global B2B payments market is large and expected to exceed $120 trillion annually by 2030, according to industry analysts. Yet despite its size, the sector remains mired in friction. Payment processing times can extend to several days, due to disparate banking systems, time zone differences, and manual reconciliations. Fees for intermediary services often reduce margins, especially for small and medium-sized businesses (SMEs). For businesses that depend on predictable cash flow, such delays are more than an inconvenience: they are a financial risk.
As digital assets and blockchain technology gain traction in the B2B sector, partnerships like the one between Mastercard and JP Morgan highlight the potential for collaboration between traditional financial institutions and blockchain innovators.
Tony McLaughlin, head of emerging payments at Citi Services, told PYMNTS he envisions a future in which blockchain plays a complementary role to existing financial messaging systems, providing a new level of coordination and efficiency. Using an analogy, he compared today’s financial transactions to arranging a dinner party over email, where multiple communication threads make coordination difficult. In contrast, blockchain could act as a messaging application, in which all parties would have a common understanding of the status of the transaction – a “common state” that would enable better orchestration of balance sheet updates.
