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Ripple’s XRP remittance platform has the potential to simplify and increase the speed of international payments, according to a new report from a London-based financial think tank.
The Official Forum of Monetary and Financial Institutions (OMFIF), an independent think tank for central banks, economic policy and public investment, highlights Ripple’s efforts to position itself as an alternative to SWIFT financial messaging service in a new report on the role of blockchain in banking sector.
“By consolidating liquidity to serve international payments from many disjointed international Nostro accounts into a single XRP pool, the banks surveyed allocate less total liquidity to serve the same volume of global payments.
The bank only needs to hold its home currency and maintain an account with XRP, with only enough XRP to meet its largest anticipated payment obligation. The process minimizes the number of brokers and their spread markup. “
The report says Ripple’s crypto-based solution could further benefit banks by allowing them to avoid the exchange rate and processing fees.
Ripple released its XRP-centric cross-border settlement platform, now known as On-Demand Liquidity (ODL), in October 2018. The platform is designed to allow financial institutions to rely on Ripple to convert their fiat currency into XRP and send the digital asset to another country, where it is then converted back to fiat.
Ripple MoneyGram’s partner is the platform’s highest-profile user and currently moves 10% of its volume between the United States and Mexico using the solution.
SBI Holdings, the Japan-based financial services firm, recently announced that it will test XRP in the $ 6.6 trillion foreign exchange market to see if it can lower costs and reduce the risk of price fluctuations when a currency is traded with. another one.
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