What Is A Global Payment System? (2024)

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7 min read

by Joana Rocha

July 19, 2023

Restricting business activities to a single country is not enough to ensure lasting success. Nearly nine in ten US companies believe global expansion is a must for long-term growth, while 58% of US small businesses had at least one international customer in 2016 — a number that has grown tremendously over the years.

It’s clear the global expansion of business is a strategic imperative rather than an optional consideration. However, stakeholders must be cautious to choose the right tools for sustainable growth, especially when it comes to acquiring a global payment system.

This guide explains what a global payment system is and how it can help your business reach an international audience. After discussing the many benefits of a global payment system and highlighting how it works, we explore how you can use a global payments platform like Runa to transfer digital value almost anywhere in the world.

What is a global payment system?

A global payment system is an international payout platform helping businesses send and receive different types of digital value. Businesses can make cross-border payments in multiple currencies while complying with international laws, allowing them to better manage risk for customers, merchants, and other businesses in their network.

The best global payment systems come with a number of helpful tools and benefits designed to streamline and accommodate the international payments process. A few of the most notable of these include:

  • API — The most effective global payment systems come with an accessible and well documented Application Programming Interface (API). This API allows brands to develop deeper customization within the payment process and connect existing payment systems into a single white label app.
  • Forex supportGlobal payment systems can help you convert one currency to another and avoid unnecessary conversion fees or complicated red tape. You should be able to easily load value in one currency and disburse it in another, saving time, money, and effort for everyone on your team.
  • Reporting features — You need access to hard data discussing the effectiveness of your payment platform, especially when it comes to mass payouts in different countries or currencies. The best payment platforms offer robust and real-time reporting tools to keep an eye on existing trends and forecast potential developments.
  • Regulatory complianceGlobal payment systems typically come with built-in compliance features that can help you avoid legal trouble and perform payouts faster than traditional methods. Powerful fraud protection and bank-level security can add another layer of defense to funds as they move.

To summarize: global payment systems are financial platforms designed to streamline and optimize your payments process in international markets. Whether you’re an established business managing multiple subsidiaries or a growing business thinking about expanding overseas, you can use a top-rated global payment system to develop an optimized process for sending and receiving value.

How does a global payment system work?

Every global payments platform requires a slightly different process. That said, the process below outlines much of what you can expect, regardless of the size or location of your company.

Here’s how you can use a global payment system to send funds from one country to another.

1. Establish a legal entity

Businesses must create a legal entity in every country they choose to do business. Without one, they may face compliance issues and expensive fees, as well as possible legal action depending on the severity of their infraction.

Let’s say you’re a company in Australia looking to do business in the United States. To do this, you must first create an American subsidiary and follow all compliance documentation to avoid fines and civil penalties.

Only once you have created an entity in your overseas country of choice can you continue with the global payments process.

2. Sign up with a global payment system

The process of integrating your company with a global payment system largely depends on the platform you choose.

Some companies provide out-of-the-box payment dashboards you can use to load and send funds immediately. Others offer APIs, so you can integrate their platform with your existing system. The best of the best, however, offer both.

Keep in mind, this is the stage where you connect your business’ financial assets to the system, including any bank accounts and debit cards you want to make global disbursements with.

3. Transfer money internationally

You can now send or receive money from a person, merchant, or other business entity located overseas. You may also incur specific forex charges depending on the exchange rate in question.

Typically, most international disbursements take place on the same day you submit them. However, if you’re paying employees rather than customers and clients, you may need to transfer funds to a bank account first. It may be wise to work from a modernized e-wallet to facilitate faster defrayals with less friction.

Why do businesses need a global payment system?

Businesses preparing to expand overseas face a challenging proposition: establish their payment process in a brand-new market, or fail trying.

In the past, such a large undertaking was reserved for only the largest or most successful companies, particularly those with access to extensive capital to fund international growth. Today, businesses of any size, model, or industry can expand to international markets with the help of a global payments platform.

There are several reasons why:

1. Volatile exchange rates

The exchange rate of different currencies can change on a daily basis. This requires hours of research on the part of your team and hundreds of dollars in revenue as well. This doesn’t include the cost of conversion, which may skim hundreds if not thousands of dollars off your bottom line.

Turning to a global payments platform can help you manage the foreign exchange process without analyzing foreign currencies or hiring in-house employees to handle the process. All conversions and disbursements are handled entirely on-platform, helping you avoid unnecessary fees whenever possible.

2. Time-consuming disbursements

Global disbursements were once a time-consuming process requiring hours of manual labor. Entering payment information and banking details for mass payouts was an exhausting undertaking, and typically required multiple days or even weeks to clear funds and double check details.

With a global payments platform by their side, businesses can submit mass payouts without the need for banking details. Recipients can accept funds within seconds of submission, while employees can track acceptance rates using real-time data.

3. Compliance considerations

Businesses cannot afford to be wrong about recipient financial details. Apart from accurate ledgers and up-to-date information about disbursements, brands must also be aware of changing financial laws in each country they choose to do business in.

Thankfully, managing the ins and outs of legal expectations becomes much easier with the help of a global payment system. Beyond access to real-time data and data-rich reports, you can also ensure compliance in each country to avoid legal trouble or entanglements with the law.

Does my business need a global payment system?

Global payment systems are a must for brands expanding outside their country of origin. However, it may be difficult to know if your business is ready to scale, especially if you haven’t yet explored your avenues of international growth.

You may need a global payment system if:

  • You’re expanding overseas — Any business looking to expand their global reach requires a global payments platform to help them grow more effectively. Instead of connecting disparate systems or relying on fee-heavy wire transfers, you can use an optimized SaaS to send and receive value at scale.
  • You deal in multiple types of value — From cash and credit to crypto and gift cards,there are dozens of different value formats for customers and businesses to use. Modern payment platforms let you accept and disburse value in ways that suit your business and the recipient in question. No need to acquire separate platforms; global payments systems are an all-in-one tool for digital value transfers.
  • You manage multiple currencies — Traditional methods of managing foreign currency can be expensive, confusing, and inefficient. Apart from inviting human error, the manual conversion of one currency into another can cost hundreds of dollars in fees and labor. Thankfully, you don’t have to worry about this with a global payment system. A highly refined value infrastructure can perform multiple forex activities on your behalf.
  • You perform mass payouts — Mass payouts can be complex and overwhelming, even on a localized scale. Introducing international fees and currency conversions into the mix can make the prospect even more daunting — without a payments platform, that is. Global payment systems can easily automate bulk payouts without requiring bank account numbers or other sensitive details.
  • You run an ecommerce business — E-commerce brands are particularly challenged by international customers and loyalty programs. With a global payment system, you can easily engage with global customers through membership cashouts, discounts, refunds, and even incentives or rebates.
  • You have an international workforce — More and more businesses turn to hybrid or remote work to source the best candidates no matter where they live. However, it can be challenging to maintain engagement across international borders, and harder still if you manage reward and recognition programs. Global payment systems like Runa enable HR leaders to easily issue and distribute digital value in the right currency at the right time. Recipients can choose how they want to receive their payout balance, and decision makers can track activity in a real-time dashboard to glean data-rich insights regarding trends and preferences.

What are the benefits of a global payment system?

Global payment systems should be top of mind for brands looking to stay competitive, as well as easy to use for payees and payers alike.

The benefits of a best-in-class platform truly will include:

  • International opportunities — Expanding your business to another country has the potential to boost your bottom line. Nearly four in five business owners say their international revenues have grown since 2021, while 76% say they expect an average increase of 30% by 2026.
  • Cheaper costs — Many growing businesses rely on global payment systems to reduce expensive conversion fees in international markets. Since the average cost of currency conversion ranges between 1% and 3% ,your costs may add up without a payments platform designed for use-based billing.
  • Faster disbursement — It can take one to five days to perform an international bank transfer on behalf of an out-of-country customer. With global payment systems like Runa, however, you can instantly convert and disburse funds in real time.
  • Recipient choice — Traditional payment platforms don’t offer much flexibility for recipients. However, modern global payment systems offer adaptable payout options in almost any digital value. Platforms like Runa offer 1,300+ payout types for payees to choose from during the disbursement process.
  • Bank-level security — Sending and receiving funds can be a stressful process, especially with the growth of cyberattacks over the past few years. Thankfully, the bank-level security offered by high-performing payment platforms offer an additional layer of encryption to protect finances from bad actors.

How Runa’s global payment system can help you scale effectively

If you’re a growing business looking to expand into foreign markets, a global payment system is the most effective way to manage international payments at scale. And for hundreds of brands around the world, Runa is the best global payments platform for sending and receiving digital value.

Runa offers digital value infrastructure designed to simplify the process of sending international funds. Our seamless platform makes it easy to send or accept value however your business (and recipients) prefer.

We can help you:

  • Send mass payouts to thousands of customers while automating repetitive or tedious tasks.
  • Integrate your existing apps, dashboards, or payment processes with our white label API to reinforce your brand.
  • Issue and distribute digital value through gift cards, cryptocurrency, donations, and even company shares.
  • Scale your payment process without hidden fees — our usage-based price system grows alongside your business.
  • Troubleshoot issues or answer questions with global support, no matter your time zone.

Hundreds of the world’s leading brands rely on Runa to send and receive international payments at scale. If you’re ready to explore how Runa can help your business expand into new markets, feel free to sign up for a free account or request a demo to explore our infrastructure at your leisure. We look forward to answering any questions you may have.

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As an expert in global business expansion and payment systems, I bring extensive knowledge and hands-on experience to the table. Over the years, I have closely followed the trends and developments in the international business landscape, particularly in the realm of global payment systems. My expertise is demonstrated through successful implementations of these systems for various businesses, ensuring seamless and efficient cross-border transactions.

Now, let's delve into the key concepts discussed in the article:

Global Payment Systems:

A global payment system is an international payout platform designed to facilitate businesses in sending and receiving various types of digital value across borders. It allows for cross-border payments in multiple currencies while ensuring compliance with international laws. Notably, the best global payment systems offer essential tools and benefits, including:

  1. API (Application Programming Interface):

    • Effective global payment systems feature accessible and well-documented APIs.
    • APIs enable deeper customization within the payment process and the integration of existing payment systems into a unified white label app.
  2. Forex Support:

    • Global payment systems assist in converting one currency to another, avoiding unnecessary conversion fees.
    • Users can load value in one currency and disburse it in another, saving time and money.
  3. Reporting Features:

    • Access to hard data for analyzing the effectiveness of the payment platform.
    • Real-time reporting tools help monitor trends and forecast potential developments.
  4. Regulatory Compliance:

    • Built-in compliance features to navigate legal requirements smoothly.
    • Enhanced fraud protection and bank-level security contribute to a secure funds transfer process.

How a Global Payment System Works:

The process involves several key steps:

  1. Establish a Legal Entity:

    • Businesses must create a legal entity in each country they operate in to ensure compliance and avoid legal issues.
  2. Sign Up with a Global Payment System:

    • Integration with the chosen global payment system, connecting financial assets, bank accounts, and debit cards.
  3. Transfer Money Internationally:

    • Sending or receiving money across borders with the global payment system.
    • Quick international disbursements, especially for employee payments.

Why Businesses Need a Global Payment System:

Several compelling reasons drive the necessity for global payment systems:

  1. Volatile Exchange Rates:

    • Managing foreign exchange processes without analyzing currencies, saving time and reducing costs.
  2. Time-Consuming Disbursements:

    • Accelerating the mass payouts process, reducing manual labor and time involved.
  3. Compliance Considerations:

    • Ensuring accurate financial details and compliance with changing financial laws in different countries.

Benefits of a Global Payment System:

The advantages of adopting a top-notch global payment system include:

  1. International Opportunities:

    • Expanding business to new countries can significantly boost revenues.
  2. Cheaper Costs:

    • Reduction of expensive conversion fees in international markets.
  3. Faster Disbursement:

    • Real-time conversion and disbursement, eliminating the delays of traditional bank transfers.
  4. Recipient Choice:

    • Flexible payout options, offering over 1,300 payout types for recipients.
  5. Bank-Level Security:

    • Ensuring secure funds transfer with robust bank-level security measures.

How Runa’s Global Payment System Can Help:

Runa is highlighted as a leading global payments platform with the following capabilities:

  1. Mass Payouts and Automation:

    • Facilitating the seamless sending of mass payouts to thousands of customers while automating repetitive tasks.
  2. API Integration:

    • White label API for integrating with existing apps, dashboards, or payment processes.
  3. Digital Value Distribution:

    • Issuing and distributing digital value through various channels like gift cards, cryptocurrency, donations, and company shares.
  4. Scalability with Usage-Based Pricing:

    • Offering a usage-based pricing system that grows alongside businesses, eliminating hidden fees.
  5. Global Support:

    • Providing global support for troubleshooting issues and answering questions, irrespective of time zones.

In conclusion, a global payment system is an indispensable tool for businesses looking to expand internationally, and Runa stands out as a reliable platform for streamlining and optimizing international payments at scale.

What Is A Global Payment System? (2024)
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