Several factors are converging to make cross-border payments one of the most interesting spaces to watch in B2B payments for 2026. Here, I explore recent developments, including the renewal of the Bank of England’s real-time gross settlement service (RTGS),
the shift to ISO 20022, emergence of digital currencies, and explain the implications for finance leaders.
The transformational impact of RT2
One of the biggest, albeit lesser-celebrated, developments of the last 12 months was the
go-live of RT2, the Bank of England’s renewed RTGS, in April 2025. RT2 is the settlement engine that facilitates interbank settlements for payment schemes, such as CHAPS. To
corporates, it is mostly invisible, as they interact with the banks in the payment scheme, rather than RTGS itself. However, its renewal will
transform how payments work in the UK, with downstream implications for payment schemes and their users.
From a cross-border payments perspective, RT2 is ISO 20022-native, facilitating greater interoperability with other international payment systems. But, as the Bank of England notes, the renewal of
RT2 was not the end destination, but the launchpad. The central bank is now consulting on further enhancements, starting with extending the operating hours of RT2 and CHAPS, paving the way for round-the-clock settlement in synch with other jurisdictions.
For organisations that operate internationally, it is worth keeping abreast of RT2 developments, as they may have longer-term implications for cross-border payment processes and treasury operations.
The key role of ISO 20022
The global shift to ISO 20022 goes hand in hand with improvements to payment infrastructure. Not only does ISO 20022 facilitate international interoperability, as detailed above, but it also boosts straight-through processing rates and reduces friction by
enabling messages to carry significantly more detailed data, aiding fraud and anti-money laundering checks.
While the first-hand impact of ISO 20022 has been on payment schemes and banks, it also has a second-hand effect on corporates, as banks downstream ISO 20022-related requirements to their customers. Adapting to these changes will be a key theme for 2026.
The challenge is getting to grips with the varying approaches banks are taking in rolling out the standard to their customers. Some banks expect customers to use ISO 20022 formats, while others will translate legacy messages. Additionally, where banks do
expect ISO 20022 to be used, the precise data requirements vary. This is because ISO 20022 is a framework that can be implemented in different ways, rather than a single format.
At the same time, corporates must prepare for new enhanced data requirements. From November 2026, CHAPS and Swift will reject payment instructions containing fully unstructured addresses; only fully structured or hybrid addresses will be permitted.
A key corporate priority for the year ahead, therefore, is ensuring that enterprise resource planning (ERP) systems can generate the file formats required by their banks and that they have clean, correctly structured address data to include in payment messages.
Revisiting the role of digital currencies
While RTGS upgrades to support real-time settlement will improve cross-border transactions, these changes won’t eliminate friction before settlement. In the current correspondent banking model, there may be several intermediaries in the chain, increasing
the potential for delays.
This is where there could be a significant opportunity for central bank digital currencies (CBDCs). Many of these projects, such as the Bank of England’s
digital pound and the European Central Bank (ECB)’s
digital euro, are very much in the concept phase. However, if they were to go ahead, the payment rails would be designed from scratch with international interoperability in mind, reducing
friction in cross-border transactions.
Arguably, 2026 is a make-or-break year for CBDCs. In many Western economies, the impetus behind CBDCs has waned in recent years. The Eurozone is an exception, with the ECB continuing to make strides in planning for a digital currency. The European Parliament
is due to vote on the next steps in May 2026. If the Eurozone decides to press ahead, it could inject momentum into other central bank projects. If not, CBDCs in developed economies could be dead in the water. As such, it is well worth keeping an eye on developments.
A new era of cross-border payments
Cross-border payments have long been considered an area ripe for reform. Now, as we start 2026, several factors are coming together that have the potential to transform international payment flows. Upgrades to central bank RTGS systems, such as RT2 in the
UK, together with the shift to ISO 20022, will reduce friction along traditional rails. In the longer term, CBDCs could offer an alternative for businesses that circumvent the limitations of the correspondent banking system. Cross-border payments will most
definitely be one of the hottest areas to watch in 2026.