French retail giant LVMH Group has worked with financial services company FIS to connect to the Swift Global Payments Innovation (Swift gpi) platform to support cross-border payment processes for its international customers, according to a FIS press release.
FIS' Trax corporate payments factory was used to connect LVMH's partner banks to the Swift gpi, a platform operated by a member-owned cooperative to support secure financial messages for commerce transactions. The aim is to improve payments efficiency and grant LVMH greater visibility in payments flow, the press release stated.
About 65% of LVMH's payments cross international borders, and the retail conglomerate plans to eventually have Swift gpi support its entire cross-border payment network, which yearly processes more than 1.5 million payments.
The need to pursue more online cross-border sales is becoming a top priority for retailers and brands of all stripes from all countries. That's especially true for LVMH, a massive holding company of 70 internationally-known brands, like Louis Vuitton, Givenchy, Christian Dior and others.
However, processing of payments between sellers and buyers in different countries using different currencies remains a hurdle to maximizing growth in cross-border commerce. A number of potential solutions are being attempted, as evidenced just days ago by a partnership between Amazon and Western Union to allow international customers to pay for Amazon purchases in person and in their native currency.
There also is a lot about cross-border transactions that leaves both parties in the dark regarding the ability to trace payments, sometimes across multiple borders and through multiple hands, and settlement confirmation. In addition, the lack of clarity is likely to raise questions on both sides of the transaction that need to be answered in the name of good customer service.
That's where Swift gpi comes in handy. It connects more than 11,000 organizations of different types in more than 200 countries, offering a standardized messaging platform to help track cross-border payments and provide an infrastructure for improving payment accuracy and investigating payment problems, such as lost payments. Most retailers and brands pursuing cross-border sales opportunities are not international financial and payment experts, and working with parties and platforms that can ease the payments process, track payments and resolve any conflicts that arise could help create payoff from their cross-border efforts.