Inside SSI | Economics | 4

🌍 Cross‑border is a small slice of volume but a giant slice of the pie. McKinsey: ≈ 17 % of payment traffic, > 25 % of revenue. USD clearing is...

🌍 Cross‑border is a small slice of volume but a giant slice of the pie.
McKinsey: ≈ 17 % of payment traffic, > 25 % of revenue.
USD clearing is winner‑take‑most; euro is flatter; exotic FX pays premiums to the few banks that dare.

Why it matters: Tuning your SSI map lets you bite into the fattest slice before margins thin under G20 fee‑pressure.

🗺️ Comment with the corridor you think is still overpriced, and why.

Inside SSI | Economics Week Recap - SSIs are the toll‑booths of cross‑border

Over the past week we dug into the economics of Standing Settlement Instructions. Here's what stood out:

1️⃣ Revenue lanes. SSIs aren't just routing rules, they decide who pockets what. Every hop collects a fare: flat fees ($5-25), FX spreads (a few bps in core corridors, >200 bps in exotic FX), float on idle balances now that rates are >0%, and add‑ons like compliance checks and investigations.

2️⃣ Dynamic pricing. Like airline seats, the same $10k can cost $20 + 50 bps off‑peak or $40 + 200 bps at cutoff. Need T+0 instead of T+2? Expect a surcharge. Your SSI map is a price handle - pick cheaper corridors or slower value dates and margins rebound.

3️⃣ Balance costs. A nostro balance is a fuel tank: capital rules turn each parked dollar into RWA and intraday credit lines eat into your LCR. Fewer hops mean less idle cash tied up in tanks you can't treat as liquid gold.

4️⃣ Profit pools. Cross‑border is only ~17 % of payment traffic but delivers >25 % of revenue. USD clearing is winner‑take‑most; euros are flatter; exotic FX pays premiums to the few banks that dare. Tune your SSI map to bite into the fattest slice before G20 fee pressure thins margins.

Topics: SSI, Payments, Compliance, FX