Blockchain-Based Solutions Could Revolutionise Remittances

Blockchain-Based Solutions Could Revolutionise Remittances

According to a recently published report, by BlockData, blockchain-based money transfers are more than 380 times quicker and almost 130 times more cost effective than those of financial systems. When you take a look at the Ripple transaction speed and fees, these statistics are even more impressive.

The report shows us that blockchain based solutions are great for remittance payments. Through a sample of sum 1,800 remittance payments, BlockData found that Ripple, BitShares, and Stellar could turn the industry in another direction. 

The reports show that while legacy systems take anywhere between two and five days to settle transactions and charge fees that could grow to nearly $10, blockchain-based solutions are able to process these same transactions in as little as two seconds, for less than $0.01 as is Ripple’s case.

Furthermore, Ripple’s technology is able to settle transactions in around four seconds, while the remittance giant Western Union needs three to five days to do so. So if we put this into perspective, Ripple could settle around 100,000 transactions in the time Western Union settles one.

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The reports goes on to add that it found the number of remittance firm’s using blockchain technology has been slowly growing over the last ten years. They go onto add that most of these don’t use their own blockchain or blockchain-based token, but rely on solutions provided by existing systems such as Ripple.

“Our results show that about two-thirds of these startups utilize blockchain technology without their own token. Most of these companies are building on existing blockchain infrastructure like RippleNet or Stellar”

The research also found that traditional remittance firms like MoneyGram and Western Union have been experimenting with Ripple’s proprietary service, xCurrent to settle cross-border payments using blockchain technology. Santander has recently confirmed that it's doing the same thing through its One Pay FX app.

CryptoGlobe has reported, “Ripple may be facing competition in the future, however, as some have claimed Facebook’s upcoming cryptocurrency could be used for remittance payments as well. The difference made by blockchain-based solutions is, nevertheless, astounding.”

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