Risk management strategy can be challenging for businesses, but it can be overwhelming when they add cross-border transactions to their list of responsibilities. Developing the right payments strategy for international transactions is key to growth and effective long-term risk management for many businesses.
In “Global Risk Management: An Innovator’s Guide,” a PYMNTS and The Bank of London collaboration, we examine the challenge of developing a global payments strategy that encompasses risk management and growth strategies. The playbook introduces the role of modern clearing banks in supporting long-term growth and international risk management strategies.
Payments and risk are indivisible
Global transactions always hold some risk, and an effective risk management strategy should start with payment process analysis. Payment processes represent core operational and enterprise risk vulnerabilities as well as opportunities to support long-term growth. 
For example, erratic payment processes can impact business-to-business (B2B) client or customer relationships, halting supply chains or damaging credit standing. This, in turn, may limit an organization’s ability to grow or even plan strategic business initiatives in new regions.
Not only is there immediate financial risk in erratic payment processes, but the damage can be long-lasting, hindering long-term business growth. Operationally, slow clearing and settlement processes can limit liquidity and hinder an organization’s ability to respond to fiscal imperatives in a timely fashion.
For many organizations, the answer is innovation.
A modern clearing bank can support effective risk management
Innovation means much more than simply doing something better or with modern tools; it can also refer to a fundamental shift in how an organization approaches problem-solving, decision-making and strategy-building. That new approach may include the acknowledgment of potential future compliance challenges and a comprehensive plan to mitigate the operational and enterprise risk involved.
In many cases, organizations can turn to an advanced solution, such as a modern clearing bank, to launch an innovation strategy and manage multiple levels of risk.
When selecting a modern clearing bank, businesses should look for the following:
• It should permit an organization to easily manage transactions or even offer end-to-end bank or payment products and services without the burden of developing a new technology stack.
• It should offer full, global regulatory compliance monitoring and provide advanced performance reporting.
• It should offer a single solution for an organization to handle clearing and settlement, banking and transaction management.
To learn more about how modern clearing banks can help in global risk management, download the report.
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