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Remittances are a big deal, especially in Asia and the Middle East. One of the main drawbacks at the moment, however, is the high cost and low speed of micropayment transfers based on traditional banking methods. The central bank of Kuwait seems to have found the answer, and it has come from Ripple.
The Fintech company in San Francisco has been making waves in the last two years in the traditional banking sector. It has expanded its partner network, called RippleNet, into over 100 banks and financial institutions. The National Bank of Kuwait (NBK) is the last to register for faster and more cost-effective transfers.
According to Arabian Business, the NBK Direct Remit service will be powered by Ripple technology but will not use its cryptocurrency, XRP. The bank has touted the services as a quick remittance solution, day and night. Deputy CEO Dimok Kokosiolis said the service "is a significant result, as it allows our customers to make money transfers in seconds, easily and at their convenience at any time of the day."
Initially, the service will be made available for transfers to Jordan, but will be extended to include other countries in the region.
Ripple executive Marcus Treacher said, "We are thrilled to have started transferring real-time payments to our blockchain network on behalf of their customers, and we will continue to work with NBK to connect them to multiple RippleNet partners, so that their customers can make faster and cheaper payments anywhere in the world. "
Last month, CIMB, the fifth largest bank in Southeast Asia, joined RippleNet to take advantage of its low-cost and high-speed transfers. Thailand's Siam Commercial Bank is also working closely with Ripple.
RippleNet has been advertised as a global payments network that can provide real-time regulation at very low cost. At present, banks charge anywhere upwards of $ 25, plus a strong forex spread, for international transfers that make remittance payments uneconomical.
According to the company blog, the network of over 100 members is part of Ripple's "Internet of Value" vision to provide "seamless global transfers".
While the expansion of the network does not affect the use of the company's native cryptographic token, new partnerships could influence the price.
In November, XRP passed Ethereum to become the world's second largest cryptocurrency by market capitalization. This move, however, seems to be soon to be canceled as Ethereum has recovered better than the XRP in recent weeks.
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