The traditional cross-border payments system is a thing of the past now with the advent of blockchain technology which makes the process cheaper and quicker. Among the thousands of blockchain companies that are facilitating a remittance service, Ripple’s products are the most talked about.
Ripple has been revolutionizing the remittance system with its fast transactions and cheaper fees. Its On-Demand Liquidity (ODL) product, which was previously known as xRapid, has been a huge success. ODL leverages XRP as a bridge between two different currencies and thus eliminating the need for any kind of pre-funding.
One of the major companies that have been using ODL is undoubtedly Moneygram, the global money transfer giant. The platform has been implementing Ripple’s ODL in its daily operations since June 2019. Since then its use has grown to handle 10% of MoneyGram’s total transaction volume between the United States and Mexico.
MoneyGram opts for Visa
Recently, MoneyGram announced a new service dubbed FastSend, to allow its customers to send money in real-time to a phone number via a dedicated website or mobile application. But surprisingly, the new system doesn’t implement any blockchain-related products including that of Ripple’s to function.
Instead, the system utilizes Visa’s Direct Original Credit Transaction to deliver funds to bank accounts through a Debit card deposit. The dedicated website and app make use of an open-source cloud-based micro service to enable the transfers.
According to Kamila Chytil, MoneyGram Chief Operating Officer, despite Ripple not being involved in the project, MoneyGram uses blockchain-based services in other areas. Chytil told Cointelegraph about Ripple’s role within MoneyGram, stating:
“Today, MoneyGram is utilizing Ripple’s On-Demand Liquidity product which allows MoneyGram to trade FX at a corporate level using XRP. It’s a back-end treasury function that’s not consumer-facing. The technology is helping to solve the most expensive and time-consuming aspect of the current process by reducing the amount of money the company needs to park around the world, which will eventually reduce working capital needs.”
Furthermore, Chytil praised the cryptocurrency market for being always active, and the ability of crypto assets to make money transfer faster. Lastly, she noted that MoneyGram is looking at multiple use cases that use Ripple’s tools and is integrating with the latest version of Ripple’s service suite to offer cash-out service to all network members.
Ripple leading blockchain remittance
Ripple continues to be one of the blockchain companies that have been acting as a key player in the fintech scene for years now. Banks and other financial institutions have realized the massive potential of Ripple’s financial products, hence many institutions have started to decentralize their processes using Ripple’s products.
According to the quarterly markets report published by Ripple insights, ODL saw noticeable growth in the last quarter of 2019. The service handled 550% more value in Q4 of 2019 than it did in Q3. In raw transactions, those services saw a 290% increase inactivity. In less than a year, over 24 financial companies signed on for ODL, including Viamericas, FlashFX, and Interbank Peru.