Which Banks Use Ripple XRP and Why?

Through this infrastructure, banks can convert their traditional banking settlement message format to an open and neutral protocol for real-time cross-border money transfer with end-to-end tracking. Banks can install it within their existing systems using an API and immediately lower their money transfer costs.

One of the challenges of large international transfers is liquidity shortages. To solve this issue, money remittance agents usually set up pre-funded accounts in the local currency of all their emerging markets, which is generally expensive. xRapid solves this hurdle by providing on-demand liquidity through XRP so that any institution can instantly send money across borders without having to first hold back up assets. It, therefore, acts as an exchange. With this solution, RippleNet stands out from competing products as one of the most scalable, efficient, and affordable worldwide payment settlement networks.

xVia is a simple protocol requiring no software installation. It enables users to instantly complete payments for invoices across the world with high levels of transparency. It’s mainly designed for large corporations that make large payments internationally

PNC, one of the US’s top ten banks, partnered with Ripple in 2016. It was the first US financial institution to go live with XRP. The service was initially availed to corporate customers of the bank’s Treasury Management Unit for a trial. All customers with access to this automatically qualified for instant international payments against invoices. The bank boasts at least $60 billion in client deposits and at least seven million customers. The Pittsburgh headquartered bank has found a market in at least 19 US states. As of September 2018, the bank announced it was starting to use RippleNet’s xCurrent to enhance payment processing speed.

StanChat, as they call it, is a multinational bank with a market in about 70 countries across all continents. The English bank has more than 1000 branches worldwide, employing nearly ninety thousand people. By virtue of its size and network, Standard Chartered sends a high volume of funds overseas. The London bank started using xCurrent in 2016 to speed up cross-border payments. Within two years of using RippleNet, Standard Chartered Bank gained a massive influence in the over $1 billion Indian-Singapore trade corridor. It further seeks to lower transaction costs in the future from the current $25 minimum for SWIFT MT900/910 through Ripple’s network.

Mitsubishi UFG Inc is Japan’s biggest bank and the fifth largest in the world by total assets. It has a higher capital base than some popular consortia such as Goldman Sachs and JPMorgan Chase. The bank has previously defended RippleNet as a better alternative to SWIFT when it comes to cross-border settlements. In 2017, it became a member of RippleNet. It cited this move as one that would help it address the pain points of traditional money transfer systems, including delays and high costs of sending money. The bank believes it will offer improved customer experience and scale up its cross-border remittances by utilizing fintech such as blockchain networks.

All banks are in the business of money, which involves cross-border payments on behalf of their customers. Today’s consumers want fast and efficient transactions even when making payments in the furthest corner of the world. Unlike SWIFT, which takes an average of three days, Ripple offers international remittances in about three to five seconds. It’s also much cheaper than alternative instant cross-border systems like Western Union and Money Gram, which have already partnered with most financial institutions. All member banks of RippleNet can access and trade with each other with zero barriers.

Banks are always shopping for more secure systems as the threat of cybersecurity continues to rise. XRP is semi-decentralized through a system of 150 independent nodes that validate transactions and secure the network. Validators are not picked randomly; one must apply and wait for vetting. You only qualify when deemed trustworthy enough, meaning you must have vested interests. Since its inception, XRP has handled over 70 million successful transactions according to the information on its website. In addition, it has had zero downtimes due to system failure, indicating stability.

XRP has maintained its position among the top ten cryptocurrencies by market capitalization. With a market cap of more than $24 billion, it offers enough liquidity for banks to settle international payments, just like the USD. Banks can hold their XRP tokens and liquidate them whenever they need to. What’s more, banks don’t need to pre-fund to send money. RippleNet allows cross-border payments through xRapid without the need to buy XRP coins. It’s, however, more convenient and faster for banks to use XRP, in which case there’s enough liquidity.

Ripple has been transparent with its vision from the onset. It has focused on attracting banks, financial institutions, and finance-focused tech firms onto its network. Most developers allied to the project are also concentrating on solutions complimenting Ripple’s existing infrastructure. The company continually recruits many banks and developers to ensure it is ahead of the market needs. In terms of acceptance, Ripple is not only a favorite among banks but has also won the approval of different governments for being environmentally friendly. It’s the first crypto network with zero carbon footprint.