Ripple reports cross-border payments success
Written by Chris Lemmon
Blockchain specialist Ripple has announced positive results for several xRapid pilots, which send cross-border payments using blockchain technology.
According to the results, participating financial institutions saw savings of 40-70 per cent when compared with what they normally pay when transferring money oversea through foreign exchange providers.
In addition, an average xRapid payment took just over two minutes, compared to today’s average of 2-3 days when sending cross-border payments. The leg of the transfer that touches the XRP Ledger only takes 2-3 seconds with the additional processing time happening while the transfer moves across the intermediary digital asset exchanges and local payment rails.
“It’s encouraging to see positive xRapid results because they validate what many in our industry already know: certain digital assets have utility,” said Asheesh Birla, senior vice present of product at Ripple. “XRP’s utility lies in its speed and scalability, which makes it the perfect fit for cross-border payments. The XRP Ledger can send 1,500 transactions per second.”
The financial institutions included in these pilots were testing payments from the US to Mexico. This is a competitive market, so payment providers are looking to gain a competitive advantage by lowering costs and speeding up payments with xRapid. Up until now, they have been required to either pre-fund bank accounts in Mexico - leading to tied-up capital - or go through the correspondent banking network, which is expensive and slow.