What are the major challenges and emerging trends in international payment systems?

There are so many. For payment systems that are expanding horizontally and vertically, there are many challenges and hurdles.

• First and foremost, Licensing & Compliance are the most important elements that require constant monitoring and adjustment. For expansion, becoming a legal registered entity in all the major territories would be a monumental task. One need not necessarily be present everywhere as a legal (registered) entity, but in many countries if a payment system in terminating and/or souring transactions, then they may need to be legally registered as such with the regulator.
• AML & KYC compliance issues. Just because you are the IOU message format of a transaction, does not mean you are some how exempted from the AML/KYC taps and/or checks.
• Connectivity to settlement switches and/or settlement networks.
• Competition from LCR (Low Cost Route) networks (that are usually domestic) or regional networks.
• Banking requirements [either direct bank accounts, Nostro arrangements of having a settlement bank(s)] - these are every changing.
• Exhaustive dispute resolution systems which again are constantly changing.
• Launching of new products/services, requires regulatory approvals and also some bespoke elements to make them merchantable in specific environments.
• Internal Audits outlay and structures and external audits SOPs and procedures (as seen by the regulator of that country)
• The constant push to lower rates and be innovative at the same time.
• Consolidation
• Balancing transaction times with monetary floats (applicable to certain markets)
• SEC (or equivalent) regulations with respect to revenue share and market dominance.
• Market knowledge of new markets