Key Takeaways
- SBI partners with Ripple to foster transactions around SouthEast Asia
- The partnership protocol will be completely decentralized for users to operate
- SBI predicts that cost of funding would be reduced with the partnership in place.
In collaboration with SBI VC Trade, which operates a virtual currency exchange in the SBI Group, and Ripple Labs Inc. of the United States, it will provide a money transfer service using XRP to the Philippines and Japan. In the future, the financial firm plans to expand the remittance destination countries centered within Southeast Asia.
The product is a mechanism that uses the virtual currency XRP as a bridge currency for international remittances, and is a payment scheme that does not require financial institutions to procure local currency in advance. It is said that it will be possible to eliminate foreign exchange risk that occurs during international remittance, reduce fees, and improve remittance speed.
Ripple explained in a previous announcement that it is important to collaborate with regulators and exchanges against the backdrop of different regulations and views in different countries when using ODL (via cryptocurrencies). This time, it seems that the scheme will be realized in Japan by clarifying the definition as "cryptographic assets" and linking with SBI VC trade.
SBI emphasized that the number of workers traveling from other countries to Japan has increased significantly recently due to labor shortages due to the decrease in the working-age population due to the declining birthrate and aging population. The partnership aims to meet the necessities of these workers for multinational remittances, the official announcement quoted, saying:
“Our mission is to provide financial services centered on remittances to foreign residents. We use Ripple's decentralized ledger technology, which features speed and low rates of deposits.”
The Hamamatsu Iwata Credit Bank already operates an international remittance platform, and with this partnership, SBI Remit is helping to expand overseas markets and already using RippleNet, Ripple's remittance network, to be fast and low from the edge. It is said that it will promote cost transactions.
What do you think of the newest partnership between Ripples and SBI Remit?
