B2B Cross-Border Payment Part 9 - The Global Gig Economy Generating Revenue in the Trillions of Dollars – Opportunity for B2B Cross-Border Payments

The gig economy has surged into the spotlight over the past decade, fundamentally altering the way we think about work.

With its massive scope and rapid growth, this sector is now generating trillions of dollars globally.

This boom presents a golden opportunity for B2B cross-border payment solutions to evolve and meet the demands of a more interconnected world.

Understanding the Gig Economy

The gig economy, characterized by freelance, contract, and short-term jobs, represents a significant shift from traditional employment models.

From tech and creative industries to services and beyond, this sector now plays a critical role in the global labor market.

Recent estimates reveal that the gig economy contributes an astonishing *$4.5 trillion* to global GDP, illustrating its immense economic impact and the vast network of transactions involved.

*Source of data: Statista

Revenue Generation in the Gig Economy

The financial footprint of the gig economy is nothing short of colossal. In 2024 alone, the global gig economy is projected to generate approximately $4.5 trillion in revenue, a figure that continues to rise as more workers and businesses embrace this flexible model.

Revenue streams span various sectors, from app-based ride services and freelance platforms to short-term contract work in diverse industries.

Challenges of Cross-Border Payments in the Gig Economy

Despite its growth, the gig economy faces significant challenges when it comes to cross-border payments:

Transaction Costs:

High fees associated with international transfers can erode the earnings of gig workers. Traditional financial systems often impose substantial charges, making cross-border payments costly for both businesses and freelancers.

Regulatory Hurdles:

Navigating different countries' regulations and tax laws can be complex and time-consuming. Compliance with varied legal frameworks poses a challenge for businesses operating across borders.

Currency Volatility:

The volatility of exchange rates can impact the profitability of transactions, leading to unpredictable earnings for gig workers and increased risk for businesses.

Opportunities for B2B Cross-Border Payment Solutions

As the gig economy continues to expand, B2B cross-border payment solutions are positioned to address these challenges and seize new opportunities:

Enhanced Payment Platforms:

Advanced payment platforms are emerging to streamline cross-border transactions, offering reduced fees and more favorable exchange rates.

These platforms can provide significant cost savings and efficiency improvements for both businesses and freelancers.

Recently, the trend of mobile payments and transactions via QR code scanning has been emerging and becoming a global payment trend.

Fintech companies should also focus on developing useful software to support cross-border B2B payments that are "Faster - Safer - More Cost-Effective."

Recognizing the substantial growth potential of this market, FinFan has continually sought to find new partners related to mobile payments, particularly businesses involved in e-wallets such as MoMo, ZaloPay, VNPay, and others.

The goal is to connect and provide the most optimal payment solutions for Vietnamese people worldwide, facilitating transactions back to Vietnam.

After extensive efforts, we have successfully developed and launched our ewallet aggregator product to support not only B2B but also B2C and C2C transactions.

This solution enables users worldwide to make payments directly to the recipient's e-wallet in Vietnam.

Blockchain and Crypto Solutions:

Blockchain technology and cryptocurrencies offer a promising alternative to traditional payment systems.

By providing faster, more transparent, and cost-effective transactions, these innovations can help mitigate issues related to high fees and currency volatility.

Automation and Integration:

Integrating payment solutions with gig platforms can facilitate seamless financial management.

Automation of payment processes reduces administrative burdens and ensures timely, accurate payments to gig workers.

Case Studies and Examples

Several companies have already begun to address the challenges of cross-border payments in the gig economy.

For instance, platforms like FinFan’s partner in Vietnam ZaloPay has been integrated into the TikTok Shop platform for purchasing to the affiliates and merchants on this second biggest revenue in 2023 e-commerce platform.

Here is the chart showing us the e-commerce market development in Vietnam in 2023.

Beyond TikTok Shop, cross-border payment services have numerous opportunities to serve as payment intermediaries for shops on other platforms such as Shopee, Lazada, Tiki, and various individual affiliates and merchants.

For example, the current collaboration between FinFan and Thunes aims to facilitate payments for Lazada, which is currently the third-largest e-commerce platform in the Vietnamese market.

The expansion and diversification of the e-commerce market provides favorable conditions for international payment solutions, simplifying the payment process and enhancing connectivity between businesses and global customers.

From the situation in Vietnam, it can be inferred that cross-border B2B payments for gig markets represent a vast and promising opportunity for international businesses.

Similarly, blockchain-based payment systems, such as Ripple and Stellar, are transforming how cross-border payments are processed by reducing costs and improving transaction speeds.

The rise of on/off-ramp services also supports businesses by providing flexible payment solutions.

This includes converting cryptocurrencies into fiat currencies in countries where mechanisms and regulations for using cryptocurrencies as a payment tool are not yet clearly established.

An exemplary case of an off-ramp service for cross-border payments to Vietnam is the collaboration between FinFan and Triple-A.

Future Outlook and Trends

Looking ahead, the intersection of emerging technologies and the gig economy promises to further revolutionize cross-border payments.

Advancements in artificial intelligence, blockchain, and digital currencies are set to enhance payment efficiency and security.

Additionally, evolving regulatory landscapes may lead to more standardized frameworks, simplifying cross-border transactions for businesses and freelancers alike.

Conclusion Regarding the Gig Economy Growth and Its Impact on B2B Cross-Border Payments

The global gig economy is a powerhouse of economic activity, generating trillions of dollars and reshaping traditional work models.

For B2B cross-border payment solutions, this presents a significant opportunity to innovate and adapt. By addressing current challenges and leveraging emerging technologies, payment solution providers can play a pivotal role in supporting the growth of this dynamic sector.

As the gig economy continues to expand, businesses and payment providers must remain agile, exploring new solutions to meet the evolving needs of a global workforce.

This article was curated and authored by FinFan's market research and development team, alongside our marketing department.

About FinFan

FinFan is a cross-border embedded financial services company that focuses on mass disbursement, fund collection, card processing, IBAN, and digital APMs solutions, which can provide valuable input and integration on and for the same.

FinFan is already integrated with almost the world's well-known MTOs, PSPs, switch, and core fintech platforms such as Money Gram, Thunes, Qiwi, Remitly, World Remit, Bancore, PaySend, Terrapay, Ria Money Transfer (Euronet), Dlocal, Ripple, TripleA, FoMo Pay, Wings, etc.

For more information, please get in touch with us through:

🌐https://finfan.io

📞(+84) 2866 85 3317

✉ support@finfan.vn

LinkedIn: FinFan