Cross-border payments are stuck in the past: paradoxically, especially for the businesses shaping the future. 

As global trade grapples with geopolitical tensions, compliance pressures, and accelerating digital transformation, business-to-business (B2B) cross-border payments remain a major friction point. Small and medium-sized enterprises (SMEs) are often hit the hardest. 

At this year’s Money20/20 Europe conference, which took place early this month in Amsterdam, Trade Finance Global’s (TFG) Mahika Ravi Shankar sat down with Bill Deng, Founder and CEO of XTransfer. They discussed how the China-based fintech company specialising in delivering B2B cross-border payment solutions is building payment pathways that empower SMEs. 

“They call it the B2B version of PayPal,” said Deng. “We are a cross-border payment platform, one of the largest in China. Our customers are importers and exporters from around the world.” Having started with a focus on Chinese exporters, XTransfer is now expanding globally and serves over 600,000 SMEs across international markets.

SME exclusion: Blocked by big banks 

As outlined by the World Bank, SMEs represent approximately 90% of global businesses and play an integral role in most economies, particularly in developing countries. Across emerging markets, formal SMEs make up 40% of the national income and generate around 70% of formal employment opportunities. 

However, traditional banks are reluctant to serve small businesses, primarily because of compliance risks and slim profit margins. 

A 2024 inquiry by the UK Treasury Committee revealed that over 140,000 small business accounts—roughly 2.7% of the total—were closed by major banks, often citing concerns around financial crime or internal risk appetite.

“Many SMEs found their bank accounts suddenly frozen by traditional banks, which is a disaster for the operation of business,” said Deng. “Banks found it wasn’t profitable to serve them, and that the risk exposure of SMEs was too high.” 

This not only disrupts the daily-functioning and the financing of SMEs, but also creates a systemic form of financial exclusion that disproportionately impacts developing countries. 

“We had to become a platform to connect SMEs and banks again,” said Deng, positioning XTransfer as an intermediary with lower compliance burdens and better risk infrastructure. 

Moving into the EU: One licence away 

Having recently obtained an Electronic Money Institution (EMI) licence in the Netherlands, which is a key milestone in its European expansion. Once its EU passporting process is completed, a step that is still underway, XTransfer can then operate across all European Union (EU) member states. Under the EU’s passporting framework, a payment licence in one country allows companies like XTransfer to extend their services across the entire European Economic Area. 

“We will treat the EU as a single market,” said Deng. “We’ll be able to onboard not only the exporters, but also importers in EU countries,” he explained, emphasising how this move drastically reduces regulatory barriers. 

Amid persistent trade tensions, such as the EU’s 2024 tariffs of up to 38% on Chinese electric vehicles and China’s counter-investigations into EU agricultural exports, both sides have been working to de-escalate ahead of a high-stakes summit in Beijing this July. 

The tariffs reflect not only significant political tension, but also how trade conflict can ripple across sectors. 

In that context, XTransfer’s expansion into the EU and its new partnership with BNP Paribas (one of Europe’s major banks), revealed at the Amsterdam Money20/20 Europe conference, show how fintech is stepping in to smooth the flow of payments for SMEs navigating a complex policy landscape. 

Their goal is to build an embedded infrastructure approach where both the buyer and the seller use XTransfer, which facilitates instant B2B trade settlements on-platform. 

Sustainable digitalisation 

Deng sees digital infrastructure not just as a form of convenience but as the engine of future SME trade. 

“The most powerful driving force is digitalisation,” he said. “Even a single person with a single laptop can do a million worth of trade each year.” 

This isn’t empty rhetoric. Slow, manual processes are getting replaced by rapid, automated, and data-driven systems. The International Chamber of Commerce’s (ICC) Digital Standards Initiative is standardising key trade documents, laying the foundations of complete supply chain digitalisation; however, the environmental impact of this process is often overlooked. United Nations Trade and Development’s (UNCTAD) Digital Economy Report 2024 warns that “developing countries bear the brunt of the environmental costs of digitalisation while reaping fewer benefits.” 

Developing countries often export raw minerals, import finished electronics, and end up dealing with large amounts of electronic waste. This issue is worsened by geopolitical competition over critical minerals. UNCTAD urges urgent action for adopting sustainable business models to support a “circular digital economy” that minimises waste and protects both people and resources. 

XTransfer’s platform also plays a role here: reducing the need for physical documentation and helping SMEs trade digitally while minimising electronic waste and resource consumption. 

Tensions, tariffs, and global interdependence 

While digital trade simultaneously brings opportunity and responsibility, escalating geopolitical tensions and violence, protectionist economic policies, and global disruptions such as COVID-19 continue to test SME resilience. 

“SMEs are very flexible. They can adapt to all the changes,” said Deng. “Even during the height of the trade war, they remained stable.” 

This adaptability shows that SMEs can pivot through crises and seize new opportunities—even amid significant geopolitical turbulence—highlighting their critical importance for emerging economies, which often suffer the most from global tensions. 

In spite of aforementioned tensions, Deng remains confident in the inevitability of global cooperation, citing the interdependence of the supply chain. 

“You don’t have a second global supply chain. You just have one single global supply chain,” he said. “Every country is involved in it, and no country can separate or cut itself off from this global supply chain.” 

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In today’s fractured landscape, XTransfer isn’t just processing payments. It’s giving SMEs the tools they need to stay agile and connected, empowering small businesses and emerging markets, and promoting international cooperation at a time of political upheaval.