Ripple has announced aggregated and averaged results from several early xRapid pilots. xRapid is Ripple’s on-demand liquidity solution which uses the digital asset XRP for more efficient cross-border transactions between financial institutions sending fiat payments.
According to the pilot results, participating financial institutions saw a savings of 40-70% compared to what they normally pay expensive foreign exchange providers.
In addition, an average xRapid payment took just over two minutes, compared to today’s average of 2-3 days when sending cross-border payments. The leg of the transfer that touches the XRP Ledger only takes 2-3 seconds with the additional processing time happening while the transfer moves across the intermediary digital asset exchanges and local payment rails.
“It’s encouraging to see positive xRapid results because they validate what many in our industry already know: certain digital assets have utility,” said Asheesh Birla, SVP of Product at Ripple. “XRP’s utility lies in its speed and scalability, which makes it the perfect fit for cross-border payments. The XRP Ledger can send 1,500 transactions per second.”
The financial institutions included in these pilots were testing payments from the US to Mexico. This is a popular and competitive market, so payment providers are looking to gain a competitive advantage by lowering costs and speeding up payments with xRapid. Up until now, they have been required to either pre-fund bank accounts in Mexico – leading to tied-up capital – or go through the correspondent banking network, which is expensive and slow.
“We were very pleased with our pilot results. It’s clear that xRapid can lower liquidity costs while increasing payment speed and transparency in a way that facilitates rigorous compliance controls,” comments aul Dwyer, Co-founder and CEO, Viamericas.
“We believe that digital assets like XRP will play a key role in the future of cross-border payments, helping to safely address some of the structural inefficiencies of legacy settlement infrastructure as their adoption grows. We look forward to exploring next steps with Ripple.”
“Mercury is delighted with the incredible speed and cost-efficiency of the xRapid pilot phase and is excited about a production rollout in the near future,” continues Alastair Constance, Founder of Mercury FX. “To date, the Ripple collaboration has been a great success.”