Payoneer, Rapyd and the Globalization of Israeli Payments

Published in Fintech & Public Markets — olam.business

Two of the most important companies in global cross-border payments were founded in Israel. Neither one solves the problem of how to accept a credit card payment in Tel Aviv. Both solve the problem of how money moves between the rest of the world and the businesses that need to receive it.

Payoneer, founded in 2005, is publicly traded on Nasdaq and serves freelancers, agencies, and SMB exporters in roughly 190 countries. Rapyd, founded in 2016, is a private payments-as-a-service infrastructure platform last valued at around $9 billion. They sit at different layers of the same global problem: Israel produces, the world buys, and the money has to find its way home.

This is the piece on what each does, why both came out of Israel, and what the next decade looks like for Israeli cross-border payments.

Why Israel produces global payments companies

Three structural reasons.

First, the export economy. Israel has roughly 10 million people and a tech sector that exports services to every major market in the world. The domestic market is too small to support most of the country's businesses on its own. Every Israeli startup that wants to scale has to figure out how to bill internationally — and that creates founder-level familiarity with cross-border payments as a hard, recurring problem.

Second, the talent base. Israel produces engineers from Unit 8200 and the broader IDF tech-corps system who graduate with deep experience in network security, distributed systems, and compliance-heavy software. Those are exactly the skill sets that build payments infrastructure. The intersection of payments and security is unusually well-staffed in Israel.

Third, regulatory exclusion. The same factors that keep Stripe out of Israel — tight banking regulation, foreign-exchange controls, market structure — pushed Israeli founders to build payments products targeted at markets outside Israel from day one. Payoneer and Rapyd are both Israeli-founded but built primarily for non-Israeli customers. That is not coincidence. It is the consequence of where the opportunity sat.

Payoneer: the freelancer's rail

Payoneer's product is, at its core, a multi-currency receiving account for businesses that earn revenue internationally.

An Israeli designer billing a US client can give the client a USD account number that looks like a regular American bank account. The client wires payment domestically inside the US. Payoneer holds the funds, applies its FX conversion, and lands the shekel equivalent in the designer's Israeli bank. The same logic applies for EUR, GBP, and a dozen other currencies. The user experience is that the world's payment systems have been collapsed into one Israeli-accessible account.

Layered on top of that core: a working-capital product for sellers on Amazon, eBay, and other marketplaces; a debit card for spending in the held currencies; tax-form handling for US-source income (1099 issuance for international contractors); integration with the major freelance platforms.

The customer base is the Israeli freelancer, the small agency invoicing US clients, the Amazon FBA seller in Tel Aviv, the e-commerce operator drop-shipping into Europe. Payoneer's IPO documents disclosed cross-border payment volume of around $44 billion annually and roughly 5 million active customers globally — a meaningful share of which is Israel-anchored.

This is the rail that lets Israel function as an export economy at the small-business layer. Without Payoneer, every freelancer and small agency would have to either accept high PayPal fees, form a US LLC, or do bank wires at unfavorable bank-set FX rates. Payoneer's value is that it made the cross-border problem tractable for businesses too small to build their own solution.

Rapyd: the infrastructure play

Rapyd is a fundamentally different business at a fundamentally different scale.

The Rapyd thesis is that every market in the world has its own local payment methods — Pix in Brazil, UPI in India, iDEAL in the Netherlands, Klarna in Sweden, Alipay in China, M-Pesa in Kenya — and a global merchant or platform that wants to accept payment from customers in any of those markets needs to integrate with all of them. That integration work is what kills cross-border commerce. Rapyd is the layer that handles it.

The product is a payments-as-a-service platform with three main pillars. Collect — accept payments from customers in 100+ countries through local payment methods. Disburse — send payouts to bank accounts, e-wallets, and cards globally. Issue — issue physical and virtual cards in multiple currencies. The customer is not the end consumer. The customer is the merchant or platform that needs payments built in.

Rapyd's customer roster includes marketplaces, gig-economy platforms, e-commerce operators, fintechs, and an increasing share of platform companies that previously would have built payments infrastructure themselves. The company has been actively acquisitive — most notably acquiring Valitor in 2022 for around $100 million to add Icelandic and European acquiring capability, and adding card-issuing and capital products through a series of subsequent moves.

The interesting Rapyd question for 2026 is whether the company has consolidated enough of the payments stack to become an actual alternative to Stripe in the markets where Stripe doesn't operate well — Latin America, Southeast Asia, Africa. The product capability is there. The brand recognition isn't, yet. That's the gap the next few years will resolve.

What they didn't build

Notice what Payoneer and Rapyd have in common: neither one fixed the Israeli domestic payments problem.

An Israeli SMB selling to Israeli customers cannot use Payoneer for that. An Israeli merchant accepting Israeli credit cards cannot use Rapyd for that. Both companies built globally and exported globally. The Israeli domestic market — until very recently — was simply not the market either company was targeting.

This is what made the August 2024 Bank of Israel designation structurally interesting. The domestic gap is finally being filled — by Grow Payments and the nonbank entities that now have direct infrastructure access. What that creates, for the first time, is a possible scenario in which the cross-border layer (Payoneer, Rapyd) and the domestic layer (Grow and the next wave) start to integrate in ways that actually serve Israeli SMBs end to end.

The next decade

Three things are likely.

First, Payoneer's wedge widens before it narrows. The freelancer and exporter SMB problem is not solved at the global level. Payoneer remains the cleanest answer for an Israeli operator who needs to receive international payments without forming a US LLC. As remote work continues to globalize labor markets, this customer base grows. Payoneer's primary risk is not competition — it is whether US LLC formation and US neobank access become so frictionless that the wedge collapses on the front end. That risk is real but slow-moving.

Second, Rapyd's competitive position depends on whether it can become a tier-one payments platform for non-Western markets. The Stripe-leaves-the-table opportunity in Latin America, Southeast Asia, and Africa is real and large. Rapyd is one of three or four credible candidates to fill that gap globally. Whether it does, or whether a regional alternative emerges, decides a meaningful share of the next decade of cross-border payments.

Third, the integration question. If Israeli domestic payment infrastructure continues to open up — and the trajectory clearly suggests it will — then companies like Payoneer and Rapyd have an option they haven't really had before: building real Israeli domestic products that connect to their global rails. A Payoneer-like product that also serves Israeli SMB domestic acceptance, or a Rapyd-built domestic Israeli acquiring layer, would change the structure of the local market.

Both companies have, historically, looked outward. The interesting move for one or both of them in the next five years is to look back home and connect the global rails to the domestic ones. The infrastructure is finally there to make that work.

— The Olam Editorial Team