The Bank for International Settlements has published a working paper comparing international payment costs through banks, fintech money transfer operators and stablecoins. The study finds that fintech providers substantially reduce costs relative to traditional retail bank wires, while stablecoins replace rather than eliminate intermediaries. Stablecoins can offer competitive foreign exchange pricing, but conversion fees and limited liquidity constrain their overall cost advantage and scalability. In a small sample of personal bank transactions, foreign exchange markups ranged from approximately 2% to 4.7%, excluding explicit wire fees, even for highly liquid currencies. For USD 10,000 transfers from the United States, median fintech costs across developed market currency groups were approximately USD 40–60, although some destinations remained substantially more expensive. Fintech providers reduce costs by offsetting customer flows internally and paying recipients from prefunded local accounts. They still depend on banking partners and wholesale foreign exchange markets to manage residual imbalances. Stablecoin transfers can achieve exchange rates close to wholesale benchmarks for major currencies, but exchange trading charges and fiat withdrawal fees add to total costs. Access to funds in bank accounts also depends on conversion and bank processing, not just blockchain settlement. Favorable exchange rates for transfers into some emerging markets reflect capital control distortions rather than technological efficiency, while thin liquidity and volatile pricing limit the amounts transferable at those rates. The accompanying discussion cautions that differences in cost coverage, corridors, observation periods and transaction sizes prevent definitive rankings across payment channels, particularly where stablecoin exchange rate costs are compared with complete remittance charges.
Bank for International Settlements study finds fintechs lower international payment costs while stablecoins face intermediary fees and liquidity constraints
A working paper published by the Bank for International Settlements finds that fintech providers substantially reduce international payment costs relative to retail bank wires, with median charges of approximately USD 40–60 for USD 10,000 transfers from the United States across developed market currency groups. Stablecoins can offer competitive exchange rates, but intermediary fees, fiat conversion delays and thin liquidity constrain their advantages. Differences in cost coverage and samples also limit definitive comparisons across payment channels.