A cross-border payment that hangs usually has one of seven causes. Three are data and paperwork, and no settlement layer changes them. Four are about the route, and settling directly between two currencies changes some of them. Knowing which one you have decides who you call.
The seven causes
| # | Cause | How it shows up | Who can fix it |
|---|---|---|---|
| 1 | Beneficiary data does not match | Return with a name, account or bank code error | You, with the beneficiary |
| 2 | Screening hold | "Under review"; a request for an invoice or contract | You, with documents |
| 3 | Correspondent declines the corridor or currency | Rejection with no clear reason, or no route offered | Your bank, or a different route |
| 4 | Cut-off or holiday in one of the countries | Payment sits a day or more, then moves | Time, or a route with fewer legs |
| 5 | No prefunded balance at the far end | Payment waits for funds to be positioned | Your bank or provider |
| 6 | Intermediary fees deducted | Beneficiary receives less than invoiced | You, by choosing who bears the charges |
| 7 | Purpose code or reference missing | Held at the receiving bank for information | You, before sending |
Causes 1, 2 and 7 are data and paperwork. A direct pair does not change them. Causes 3 to 6 are about the route. Fewer legs, balances held in both currencies and settlement that runs 24/7 change them.
Cause 3 is the one that has been growing
The Financial Stability Board's correspondent banking data report, published 16 November 2018 using 2017 data from SWIFT, found that active correspondents fell 15.5% between January 2011 and the end of 2017. The decline was steeper for smaller economies: in the report's breakdown by economy size, the ratio of foreign counterparties to local banks fell 23.4% for economies with GDP below USD 10 billion, against 8.4% for economies above USD 1 trillion. That report is old, and the pattern it describes is why a payment can fail for reasons that have nothing to do with the sender.
The G20 targets give a sense of the standard the system is measured against. By the end of 2027, 75% of cross-border wholesale payments are meant to be credited within one hour of initiation, and for retail payments (the target's own note includes B2B), the global average cost should be no more than 1% with no corridor above 3%. The Financial Stability Board published its latest consolidated progress report on 9 October 2025.
A thirty-minute diagnostic
Take your last five payments that took longer than expected.
- Write the date sent and the date credited.
- Find the reason code or message in the bank's notice. If there is none, ask for it in writing.
- Put each payment into one of the seven rows above.
- Count. If rows 3 to 6 dominate, the problem is the route.
- For each, note whether the route went through a third currency. If it did, ask what the same payment would look like as a direct pair.
What a direct pair does and does not change
Modality holds balances in 36 account currencies and converts across 630 direct pairs, so a payment between two of them is one conversion, not two, and does not wait on a dollar leg. Settlement runs 24/7. That addresses causes 4 and 5, and by cutting intermediaries it addresses part of causes 3 and 6. It does not remove the screening and data checks in causes 1, 2 and 7, which every institution in the chain still runs. For why payments take days, see why cross-border payments take days and cross-border payments without correspondent banks. For what intermediaries take, see the correspondent bank fee breakdown, and for the dollar leg on one corridor, the dollar tax on EUR to TRY.
Frequently asked questions
Why does a payment return without a clear reason?
The returning bank sends a code, and the message that reaches you may be shortened. Ask your bank for the original reason code.
Is a stuck payment lost?
Rarely. It is usually held, queued or on its way back. Ask your bank for the tracking reference and the current holder.
Does paying in the beneficiary's currency help?
It can remove a conversion at the far end. It does not change screening or data checks.
What is a nostro account and why does it matter here?
It is an account a bank holds with a correspondent in another currency. If it is empty, the payment waits for funds to be positioned. See the pre-funding tax.
Sources
- Financial Stability Board, "FSB Correspondent Banking Data Report – Update", 16 November 2018 fsb.org
- Financial Stability Board, "G20 Targets for Enhancing Cross-border Payments" (page last updated 13 October 2026; latest listed progress report dated 9 October 2025) fsb.org
- Modality coverage sheet, July 2026 (36 account currencies, 630 direct pairs).
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