An international banking alliance is using the Ripple blockchain network technology for cross-border payments efficiency. Banks from Canada and Israel signed an agreement with National Australia Bank (NAB), Australia’s largest business bank, to improve the security and efficiency of their payment systems, share innovation strategies, and more.
Top Banks Use Ripple For Cross-Border Payments
Currently, the Ripple payment network works with worldwide financial institutions from over 55 countries. Their On-Demand Liquidity (ODL) service uses the digital asset XRP “to source liquidity during cross-border transactions, as an alternative to traditional systems.”
The Canadian Imperial Bank of Commerce (CIBC) and Israel’s Bank Leumi, recognized small business banks, are now using the Ripple payment network for cross-border transactions as a result of their alliance with the National Australia Bank.
The partnership is meant to enhance customer experiences by reducing costs, speeding up the payment service, and improving security. Reportedly, transactions that could have taken up to 2 days to become effective, can now be completed within minutes.
“We believe that the technology has the potential to not only deliver real time international payments, but also improved security and efficiency of our payments systems, so this is an important piece of work” said National Australia Bank (NAB).
The large Australian bank stated: “We’re excited to be working with CIBC and have already partnered with them in using Ripple’s blockchain technology to complete international payments transfers between our banks as a proof of concept.”
The financial institutions’ alliance is also expected to open new doors for each “to access first-class international innovation initiatives and insights,” NAB Executive General Manager NAB Labs Jonathan Davey said via the bank’s official announcement.
“Our customers want us to do things differently and strategic partnerships like this allow us to access ideas, talent and capabilities of like-minded organisations, in this case the opportunity to tap into two leading international banks, to help us gain world-class insights from global leaders to benefit our customers.”
The General Manager added that this is an opportunity for the institutions to develop solutions for common issues, as well as combine and leverage global knowledge and insights in order to “find ways to get in front” amidst the competitive and “rapidly changing world” of fintech.
The Network Grows Despite Lawsuit
Despite the SEC vs Ripple Labs lawsuit, the company has been growing its reputation overseas and its several international partnerships.
The Ripple network is becoming popular in Australia. It is recognized by financial businesses and the company members work alongside the country’s authorities as they develop a regulatory framework on crypto.
Last year, the company proposed three principles upon which an Australian regulatory framework for digital assets should be founded. This was included and credited upon the Australian Senate’s “Select Committee on Australia as a Technology and Financial Centre” final report.
According to RippleNet General Manager Asheesh Birla, the company ended 2021 with “a payment volume run rate of over $10B and expanded its On-Demand Liquidity (ODL) product to 22 destination markets.” He noted that the ODL product is near to achieving global coverage.
Birla believes the rapid growth is due to ODL’s “higher transaction speed and its more efficient use of capital,” in contrast with the traditional financial system.