Distributed ledger technology (DLT) appears to be making progress in its effort to provide the financial services ecosystem with an alternative to traditional rails, with a focus on easing cross-border payments friction.
This week's look at payment rail innovation finds growing adoption of blockchain tools by financial institutions (FIs) as innovators highlight the costs and inefficiencies of the traditional correspondent banking system. The newest initiatives on the market focus on transaction speed, transparency and cost savings as a result of powering global transactions via blockchain. Below, PYMNTS takes a look at what proponents have to say about choosing an entirely new rail over traditional ones.
RippleNet Marks Banking First
Blockchain payments company Ripple has announced that Brazil's Banco Rendimento has signed on to adopt RippleNet Cloud, Ripple's cloud-based payment network, according to a press release. Banco Rendimento is the first bank to use Ripple technology that is entirely cloud-based. The technology enables faster cross-border transactions via blockchain, while for the FI itself, the cloud-based technology enables more seamless integration and a lower total cost of ownership, the companies said.
"Migrating our payment infrastructure to RippleNet Cloud allows us to provide our customers with a best-in-class experience," said Jacques Zylbergeld, FX superintendent at Banco Rendimento, in a statement. "Customers can now enjoy more transparency and easier navigation for both submitting payments and trading. RippleNet also allows us access to global partners, offering a standardized solution and ensuring the integration and onboarding processes are seamless."
IXOPAY Partners To Ease Merchants Onto Crypto
Designed for businesses without experience in cryptocurrency or blockchain, IXOPAY connects businesses to a DLT-based payment tool to provide seamless payments management. The company recently announced a partnership with Finrax, which will integrate an end-to-end solution that supports merchants' ability to accept and send cryptocurrency and settle funds in euro or in crypto. The firms highlighted the particularly beneficial use-case of the technology in the cross-border B2B and B2C payments space, noting, "the advanced payouts feature provides a fast and reliable way to initiate payments to suppliers and vendors."
"We can see that the demand for crypto payments is growing, which is why we want to make sure that our clients have access to [payment service providers] who are specialists in the field," IXOPAY Chief Strategy Officer Gox Mailer said in a statement.
Apifiny Debuts Instant Global Settlements
Using blockchain technology, Apifiny has rolled out a new solution for FIs to accelerate global payments and remittance clearing and settlement for both traditional and digital assets. Dubbed Roxe, the settlement network facilitates real-time clearing of transactions across borders.
Pointing to some of the biggest points of friction in the traditional correspondent banking system, Apifiny noted the value that blockchain and digital assets have to overcome a lack of transparency, inefficiency in currency exchange, and a lack of speed associated with traditional cross-border payments.
"Today’s global financial system is extremely fragmented, meaning assets cannot be quickly and freely transferred between markets, countries and various settlement systems," the company said. "... Roxe aims to solve this value transfer problem by more efficiently connecting the world’s banks, scattered assets, markets and systems around the world to free asset transfer from the friction built into financial institutions’ accounting systems."
Switzerland Eases Rail Friction With QR Codes
Switzerland is gearing up to roll out a new invoicing and bill payment technology that uses QR codes to address the friction of traditional payment methods. Called QR-bill, the technology, which will launch at the end of June, aims to replace payment slips by presenting bill recipients with a QR code to facilitate payment. Payers do not have to change their payment habits, however, and can continue making payments via bank transfer, by mail or eBanking, according to a press release. Companies that send invoices can benefit from a more efficient and digital payment process, while recipients can have choice in how they settle their bills. The solution was developed by SIX with collaboration from stakeholders in the Swiss financial services sector, including banks, software providers and corporates.