xRapid will be used to provide speed and efficiency according to Brad Garlinghouse, CEO of Ripple. Ripple has agreed to provide a capital commitment worth $50 million to MoneyGram’. The Ripple-MoneyGram deal comes one day before Facebook reportedly launch its blockchain project called Libra.
The partnership will focus on Ripple’s xRapid, a solution for providing on-demand liquidity. The service reduces the reliance on pre-funded nostro accounts, enabling instant currency settlement in a destination currency using XRP as an intermediary.
“As the payments industry evolves and matures, it’s imperative that we continue to improve our platform and provide the most effective solution to get funds from point A to point B,” said Alex Holmes, MoneyGrams Chairman and CEO. “Through Ripple’s xRapid product, we will have the ability to instantly settle funds from US dollars to destination currencies on a 24/7 basis, which has the potential to revolutionize our operations and dramatically streamline our global liquidity management.”
MoneyGram’ operates globally in the $600 billion global remittance market, serving millions of customers in more than 200 countries and territories, supporting multiple currencies. Today, MoneyGram relies on traditional foreign exchange markets to meet its settlement obligations, which require advance purchases of most currencies. Through this strategic partnership, MoneyGram will be able to settle key currencies and match the timing of funding with its settlement requirements reducing costs, improving its balance sheet efficiency and reducing risk.
This strategic partnership will enable MoneyGram’ to greatly improve its operations and enable millions of people around the world to benefit from its improved efficiency. This is a huge milestone in helping to transform cross-border payments and I look forward to a long-term, very strategic partnership between our companies,” said Brad Garlinghouse, CEO of Ripple.