What is a gateway operator responsible for in cross-border payments?

A gateway operator in cross-border payments primarily facilitates the connection between merchants and financial institutions, ensuring that transactions are processed efficiently and securely. Performing currency conversions is a critical function in this context because cross-border transactions often involve different currencies. The gateway operator ensures that currency conversion rates are applied, enabling the transaction to be settled in the appropriate currency based on real-time exchange rates.

This function is essential for enabling international commerce, as it streamlines the payment process and allows merchants to accept payments from customers around the world without facing currency barriers. By managing this aspect of the transaction, the gateway operator simplifies the payment experience for both merchants and consumers.

Other responsibilities such as verifying merchant identities, initiating funds disbursement, and providing customer support are important in the broader context of payment processing but are not the primary focus of a gateway operator when it comes to cross-border payments. Verifying identities may typically fall within the compliance or risk management roles, while initiating disbursement and customer support are generally handled by banks or payment processors rather than the gateway operator directly.