There is no doubt that Ripple and XRP have their critics. The blockchain-focused fintech company and the cryptocurrency XRP have long been seen by some as opposite to the broader blockchain and decentralization movement because they facilitate transactions for financial institutions.
Many have also questioned the need for a network like RippleNet when other modern solutions exist or can be implemented. While skepticism has grown on social media, the CEO of a company that uses Ripple technology and XRP says his firm has seen meaningful improvements in its business results thanks to a partnership with the San Francisco-based fintech.
At a recent event, Alastair Constance, CEO of international payments specialist Mercury FX, discussed Ripple. For context, Ripple claims that Mercury FX joined RippleNet to “speed up transfers, reduce costs and open new markets that were previously too expensive.” Mercury FX was originally founded to serve businesses and high-net-worth individuals because “long processing times and high fees for existing cross-border settlement technology made only large transfers profitable.” As Constance explained:
To truly grow, we wanted to serve anyone who needs cross-border payments. When we discovered Ripple could help us make payments 100 times faster and at a fraction of the cost, it was a turning point.
Constance later described how Ripple’s technology reportedly supported Mercury FX’s operations. One key capability was RippleNet’s On-Demand Liquidity (ODL), formerly known as xRapid, which uses XRP as a bridge between the fiat currencies being exchanged. ODL enabled Mercury to route transactions to and from Mexico with partner banks in a way that was both cheaper and faster than traditional methods. Constance said:
Mexico had never been economically viable for payment processing because the cost advantage didn’t exist. […] With RippleNet we were making payments in seconds and the price dropped from $50 to about $2. The process was so successful that we soon facilitated payments for a UK company importing Mexican foodstuffs.
Another corridor where Ripple-supported processes helped Mercury FX is remittances between the Philippines and the United Arab Emirates. The company now moves funds between those countries where fees had previously been around 8 percent; Constance said fees are now much lower.
Mercury FX was among the first financial firms to use ODL (formerly xRapid). The company processed its initial ODL-powered payments in late 2018, launching a corridor between the UK and the Philippines.
Santander also expands cooperation with Ripple
In a recent interview with Bloomberg, Ana Botín, chair of the Spanish banking group Santander, said the bank will bring its Ripple-based payments app One Pay FX to the United States.
We are launching One Pay FX, a blockchain-based cross-border retail payments platform—incidentally with Ripple, a U.S. company. It’s coming to the U.S. We will operate Open Banking.
To date, One Pay FX is live across four corridors: the UK, Brazil, Mexico, and Spain. Santander uses Ripple’s payments messaging system, which is designed to compete with SWIFT and does not use XRP.
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