Ripple’s xRapid is gaining momentum, and that’s putting the traditional cross-border method of SWIFT under risk. The competition of Ripple’s technology and SWIFT’s conventional way of transfers is heating up.
Ripple started off in 2012 with a promise to make cheaper and faster payments using blockchain technology.
Swift, on the other hand, is an age-old company which is 45 years old, which is an interbank service that has and still handles most of the cross-border transactions. It is owned by a co-operative owned by thousands of member banks.
Ripple started making headlines after its initial partnership with Banco Santander which now uses Ripple to send money across several countries in mere seconds.
Swift’s traditional method of passing through multiple banks is not only time consuming but expensive on the fees side.
Ripple’s transparency on the state of the transfer adds another point when compared to SWIFT where the coordination cannot be tracked at all.
Swift has thus tried to battle it out with the technology of cloud and API solutions with a statement of already making payments in minutes and sometimes seconds. Swift’s new Global Payment Innovation is used by 165 banks and is noticed to take only 30 minutes for cross-border transfers.
Swift could very well use blockchain’s technology, but according to the team of SWIFT, it is not very easy to implement due to the 11,000 member banks.
However, one thing that can’t go unnoticed is the lack of use of Ripple’s cryptocurrency which is XRP. XRP according to many is as volatile as the other cryptocurrencies and thus is not used by many of the bank’s employing Ripple’s technology.
Brad Garlinghouse, CEO of Ripple has boasted about Ripple’s technology in the last few weeks.
He highlighted that more banks would use Ripple’s technology by the end of the year in the Money 20/20 Europe fintech conference in Amsterdam.
“I’ve publicly stated that by the end of this year I have every confidence that major banks will use XRapid as a liquidity tool,” Garlinghouse said.
Ripple’s partnerships are growing day by day, wonder what’s in store for them next!