International transactions are on a sharp rise, and according to estimates made by the World Bank, around $573 billion was sent in remittance back in 2016. The World Bank also estimates that the majority of this amount — $422 billion — was sent to developing countries.
Global remittance continues to grow
The remittance, which is basically an act of sending funds to another country, is growing bigger every year. However, thanks to blockchain technology, the way in which people are making these transactions is changing, as well.
As many might already know, the technology behind Bitcoin and other cryptocurrencies, the blockchain, has a number of highly-valuable use cases. Near-instant international payments are definitely among the top ones, and they give this technology the potential to completely transform remittance business.
Enter Ripple, a US-based cryptocurrency company that is responsible for the creation of the third-largest coin by market cap, XRP. Ripple has also created a number of payment products that deliver on-demand liquidity. The company then offered these products to banks and financial institutions around the world, and it currently has over 200 of them using its technology or working on implementing it.
Ripple technology responsible for 10% of MoneyGram’s US-Mexico payments
MoneyGram, for example, has been using it since August of this year, and recently, at Ripple’s conference known as Swell, MoneyGram CEO, Alex Holmes, shared some interesting information about it. He said that around 10% of MoneyGram’s business between the United States and Mexico happens to go via the Ripple Network.
Ripple has called attention to this information as well, pointing out on its website that cryptocurrency is how as much as 10% of the money sent to Mexico arrives there. Holmes also stated that 10% relates to the On-Demand Liquidity platform and that it represents the volume of the Mexican peso, as traded by MoneyGram.
Holmes concluded by saying that MoneyGram will continue to collaborate with Ripple and build liquidity, with new corridors already being planned, including the Australian dollar and the Philippine peso.