The quick read
The technical and financial infrastructure that supports cross-border payments is an absolute mess. That’s why banks and payment companies are looking for better, more efficient ways to process these transactions. Blockchain technology holds promise in this space, which is why MoneyGram has agreed to test out Ripple’s XRP cryptocurrency. (American Banker)
MoneyGram, the world’s second-largest cross-border payments company, is a big get for Ripple. Ripple has faced significant public scrutiny over the value of its XRP currency and the centralized nature of its coins. (TechCrunch)
The key details
International bank payments are slow and the associated fees often remain unknown until after a transaction has reached its final destination. MoneyGram, a major player in the $600-billion-a-year remittance market, is similarly afflicted. Enter Ripple. The San Francisco startup is offering on-demand liquidity and rapid foreign exchange through XRP, theoretically allowing financial institutions to send payments around the world without the need for multiple corresponding accounts. Fees would be lower and the payment flows more transparent. (American Banker)
The bottom line
This is a big get for Ripple after a wave of bad publicity and an ever bigger test for blockchain technology. The current cross-border payments system is extremely inefficient. If blockchain technology can solve this problem, it’s a huge win for the platform.