- Financial institutions involved in Ripple's pilot program for cross-border payments report significant time and cost savings
- Participants claim transaction savings of 40–70% by eliminating need for third-party currency exchange
- Pilot included institutions processing transfers between the US and Mexico
A number of financial institutions that have participated in a pilot money transfer program using Ripple’s xRapid platform have reported significant savings on transaction processing times and fees.
According to a report just released this week, participants report cost savings of 40–70% as well as a drastic reduction in payment speed, cutting the average 72-hour processing time down to less than three minutes.
Ripple's xRapid is powered by the digital disruptor's blockchain system, which settles international payments in real-time without the need for third-party foreign currency exchange providers. The platform facilitates faster, cheaper cross-border payments between banks and other financial institutions.
Recent industry data established Ripple as one of the top three cryptocurrencies based on market capitalization.
The pilot program tested international payments between Mexico and the US. Under the conventional system, US banks must either use capital to maintain a pre-funded Mexican bank account or use an expensive correspondent banking network.
By using Ripple, program participants were able to bypass these costly, time-consuming steps.
Paul Dwyer, CEO of Viamericas, an international funds transfer company, said that the Ripple pilot proves that digital will play a crucial role in the future of remittances, helping banks "safely address some of the structural inefficiencies of legacy settlement infrastructure" and implement "rigorous compliance controls".
Last month, Santander became the first global bank to adopt Ripple's blockchain for international P2P payments. Other traditional financial institutions seem eager to test out the cryptocurrency waters, with JPMorgan announcing just this week that it had filed a patent for its own blockchain payments network.
