Ripple’s Cutting-Edge Technologies for Cross-Border Payments Aim To Replace Standard “SWIFT” Transfers
Making cross-border payments can many times be frustrating, and quite time consuming. High fees, and too many intermediaries are also factors. There can be instances where the fastest way to transfer money from New York to London, is by going to JFK and catching a flight to London with cash at hand. What if I want to transfer money but banks are closed due to the weekend or a national holiday? What if my bank doesn’t have a nostro account in the country I’m looking to transfer money to? Sure, there are corresponding banks affiliated, which can process my transactions.. But why wait a few business days in this day and age where everything is in real time? The current “SWIFT” system being used by banks to make transfers is in dire need for improvement. In addition, SWIFT be seeing some serious competition, with the rise of blockchain technologies. Ripple, led by CEO Brad Garlinghouse, is at the head of the cross border payment revolution.
Ripple, a company which may be primed to overtake the cross-border payments industry, is building a platform for global payment systems. Through blockchain technologies, Ripple aims to help companies make cross border payments instantly, without intermediaries or high fees!
Banks are partnering with Ripple in order to take advantage of their new instant payment platform. Garlinghouse, the CEO, claimed that Ripple had already made alliances with over 600 firms and banks, including Santander, Saudi Central Bank, and Bank of England. In addition, Garlinghouse assures that unlike many cryptocurrencies which are valued because of current buzz and prospective projects, Ripple actually has a practical application which is in operation. In turn, Ripple should be able to survive a market crash. Another advantage Ripple has, is that it’s working with governments and regulators. Banks are highly regulated by the government, and so must any venture a bank may undertake. Garlinghouse posits that it is strategically better to “Work with the system” as opposed to circumventing lawmakers, regulators and governments.
Garlinghouse stated “While contrarian and unpopular in the crypto space, in retrospect it’s really smart.”
Most people have heard of Ripple due to their cryptocurrency dubbed XRP. XRP spiked to almost $4.00 earlier this year, however it has fallen back down to around $0.80. Garlinghouse, claimed he doesn’t really want people to associate Ripple just for XRP, or for being one of the top cryptocurrencies listed on CoinMarketCap. Rather he wants individuals to understand that Ripple is a solid company providing practical solutions for the financial industry which can revolutionize banking and global transfers.. “We are a payments company” he said.
The CEO further went into detail on how Ripple takes advantage of blockchain technologies, in order for banks to record transactions. XRP, the company’s signature cryptocurrency, is used as the payment method between banks throughout transactions. If one were to send US Dollars to a person looking to receive Colombian Pesos, the US dollars would be converted to Ripple, and then the Ripple to Colombian Peso, all within a matter of seconds. Ripple’s transactions can be processed within seconds in the blockchain, as opposed to Bitcoin transfers which can take hours, and SWIFT which can take days.
Ripple’s end goal is for banks to completely replace the old SWIFT system for cross border payments, with their own payment software which they call xCurrent.
Attached here is a video explaining Ripple’s services in simple terms: