Traditional cross-border business-to-business (B2B) payments operate on infrastructure designed decades ago. A single cross-border transaction can pass through multiple correspondent banks, incurring fees at each intermediary, settling in batches during limited central bank RTGS operating hours, and taking two to five business days to credit the beneficiary. For corporate treasurers managing supplier payments across multiple corridors, this fragmentation imposes a direct cost in fees and an indirect cost in working capital tied up in settlement float. The 2021 BIS Innovation Hub Nexus report noted that IPS-enabled domestic payments often reach recipients in seconds at near-zero marginal cost to the sender, while cross-border equivalents remain "slow, complicated and expensive" by comparison.
Project Nexus, a multilateral initiative led by the Bank for International Settlements (BIS) Innovation Hub and central banks across Southeast Asia and India, proposes a structural fix: connect domestic instant payment systems via a standardised gateway, so a payment initiated in one country's real-time system can be received in another country's system within 60 seconds. The initiative is set to go live in 2026, targeting a network initially linking instant payment systems in Indonesia, Malaysia, the Philippines, Singapore, Thailand, and India — a catchment covering an estimated 1.7 billion people, according to The Asian Banker.
How Nexus Changes Supplier Settlement Economics
The mechanics of Nexus directly address the cost and timing frictions of supplier payments. Under the Nexus model, a corporate in Singapore can initiate a payment to a supplier in Thailand through Singapore's FAST system. The Nexus gateway converts the payment instruction into ISO 20022 format, routes it to Thailand's PromptPay system (or its successor real-time system), and settles the Thai leg in central bank money — either in real-time immediate settlement or, where deferred net settlement (DNS) is used, within that system's existing cycle. The BIS technical report explicitly states that Nexus "does not require changes to the domestic settlement process in each IPS" and fully supports both real-time and DNS models.
For the corporate payor, the benefits are threefold. First, transaction cost compression: by eliminating the need for bilateral correspondent banking links and the associated fee chains, Nexus standardises the connection through a single API integration. The BIS notes that Nexus eliminates the need for "custom connections for every new country," replacing what would otherwise be complex and commercially viable only for high-volume corridors. Second, settlement speed collapses from days to seconds. Third, cash conversion cycles improve: when a supplier receives funds instantly upon shipment confirmation rather than after a multi-day settlement lag, the buyer can negotiate better payment terms without harming the supplier's working capital.
HSBC's Ma-an David, domestic payables lead for global payments solutions in Asia Pacific, framed the corporate perspective directly: "As a corporate, you don't want to be opening accounts everywhere in all the corridors you need to do transactions with. BIS… is leading a movement to interconnect real-time payment infrastructures in a multilateral manner, making investments more efficient."
The Multilateral Gateway Versus Bilateral Links
The economic case for Nexus rests on a network-effect logic that bilateral links cannot replicate. Each bilateral connection requires separate legal negotiations between payment system operators, central banks, banking associations, and participating banks. The Mastercard white paper on cross-border real-time payments notes that such investment "is only commercially viable when connecting close trading partners or strong remittance corridors," meaning many lesser-used corridors remain permanently unserved.
Exhibit
Bilateral vs Nexus Gateway Connections
Links required for N connected IPS operators
Number of connections required (links)Source: Orionmano Industries
The chart above illustrates the scaling advantage. With six IPS operators — the projected initial Nexus cohort — a bilateral approach would require 15 distinct links, each carrying its own legal and technical overhead. Nexus reduces that to six single connections to the gateway, each conforming to standardised templates. The World Economic Forum's 2023 report on cross-border fast payments highlighted that Nexus "provides standard template contracts and compliance documentation to drive consistency," further reducing the friction of onboarding new corridors.
Regulatory Convergence and Cost Reduction
Regulatory compliance is a hidden cost driver in cross-border payments. Anti-money laundering (AML) checks, sanctions screening, and data privacy requirements vary across jurisdictions, and each bilateral link must navigate these differences independently. Nexus addresses this by embedding a "unified Nexus scheme" that streamlines legal and regulatory complexity. The WEF report notes that the project advocates "regulatory convergence through identifying best practices and gaps" and fosters "coordinated oversight between central banks."
For corporate treasurers, this standardisation translates directly into lower operational overhead. Instead of maintaining compliance workflows for each corridor, the Nexus gateway provides a single compliance framework that participating PSPs can adopt. The BIS's 2025 project update confirms that the Eurosystem has joined as a special observer, exploring how to link its TARGET Instant Payment Settlement (TIPS) with other fast payment systems — an indication that the model is gaining traction beyond ASEAN.
Outlook: Accelerating Payments Growth
The 2021 proof of concept demonstrated a cross-border payment between the Eurosystem's TIPS, Malaysia's RPP, and Singapore's FAST systems, proving the technical viability of the model. Since then, the partner central banks have moved toward implementation, and the 2026 go-live target is firm. For finance executives, the implications are clear: as Nexus expands from six initial countries to a broader global network, the cost and speed advantages will shift cross-border B2B payments from a back-office friction point into a strategic tool for working capital optimisation.
Supplier settlement costs — both explicit fees and hidden float costs — will compress toward domestic-level unit economics. Cash conversion cycles will shorten as payments settle in seconds rather than days. And the multilateral model ensures that even lower-volume trade corridors gain connectivity that bilateral economics could never support. Project Nexus does not merely incrementally improve cross-border payments; it re-architects the infrastructure.