RippleNet’s new software update offers ‘bunch of functionalities’ to partners, claims Ripple executive
Ripple, one of the prominent players in the FinTech industry, continues to make strides in the cross-border payment settlement ecosystem. The firm recently announced a partnership with MoneyGram, a money transfer company headquartered in Dallas. Ripple would be investing around $50 million in the company.
The agenda behind this investment is to increase the adoption of RippleNet, Ripple’s global payments network. Importantly, this would boost the use of xRapid, a product of RippleNet that utilizes XRP for cross-border payment settlement, considering MoneyGram has established its presence in over 200 countries.
Kevin Mole, VP of Product Marketing, recently discussed on-demand liquidity and XRP’s role in it, in an interview with RippleDrop. Upon being asked about on-demand liquidity, the VP stated that it was “a way for customers to send fast low-cost payments, without having to pre-fund the destination account.” The VP spoke about this further in the extended video released on 18 June. He said,
“Today’s correspondent banking network is so slow that in order to deliver a fast experience, you have to pre-fund accounts in the destinations in which you’re sending money to. You’re storing capital like cash really in those accounts for days at a time and that’s highly inefficient, it’s a poor use of money.”
He went on to say that on-demand liquidity places XRP in the middle of the payments taking place from one country to another. Mole added that this in turn, enables near-instant payment without the need of having funds in the destination account.
This was followed by the executive being asked about where on-demand liquidity was available. To this, Mole stated that it was currently available in Mexico and the Philippines. He added that Mexico and the Philippines were “very large receive side countries when it comes to remittances.” He further stated that $31 billion flowed into Mexico every year, while the Philippines saw an inflow of $33 billion on a yearly basis. Mole went on to state,
“We believe that there’s a large amount of demand there. And also, the types of payments that people are making into these countries like Mexico and Philippines from US and Europe and parts of Asia are really to cover necessities [….] So, this is a really high-impact cross-border flow and the first of many corridors that we will open up this year.”
Further, the Vice President of Product Marketing also spoke about the reason people would be interested in using on-demand liquidity. He stated that there were two key factors, speed and low cost, adding that XRP was the main reason for better speed as it settles payments within 3-5 minutes, as opposed to other payment rails.
“[…] second thing is low cost. so the ability to not have to pre-fund all these accounts around the world means you can use that capital which you would otherwise have had in various bank accounts to put to good use marketing your products lowing the cost of your product to the end-user it’s about growing your business […]”