Ripple Announces Line Of Credit Offering

Enterprise blockchain service provider Ripple on Thursday (Oct. 8) announced a beta offering called Line of Credit that it says lets its FinTech customers use the XRP digital currency to send cross-border payments. The service is not available to individuals.

“With a line of credit from Ripple, your financial institution can use XRP to complete instant, low-cost cross-border transfers,” the company said in its announcement. “We allow you to lock in a rate at the time of the payment, then repay us when it’s convenient for you, for a small fee.”

The service “lowers both the cost of holding trapped capital and operational costs associated with sending cross-border payments,” Ripple wrote in the announcement.

On its website, Ripple said its Line of Credit can help lower the cost of capital for firms.

“Freeing up capital for your customers’ cross-border transactions can be inefficient. At the same time, creating credit arrangements for each destination market is time-consuming,” the company said.

Line of Credit works on the RippleNet platform.

Ripple said it has successfully piloted the program with existing RippleNet customers.

Ripple describes its business model as using “technology to deliver financial solutions vital for businesses that were once only offered by multinational banks — without the cost and overhead of legacy systems. By leveraging distributed ledger technology (DLT) and XRP, the universal asset for the exchange of value worldwide, Ripple can deliver access to services that were not previously possible.”

Line of Credit is not available in some markets, according to the announcement.

Ripple has been expanding its cross-border operations in recent years.

Earlier this week, Ripple Executive Chairman Chris Larsen said what he perceives as a hostile U.S. regulatory climate may lead him to move the company to another country.

Ripple has about 500 employees in nine offices around the world, according to its website.