Ripple recently released new numbers on a series of pilot tests with xRapid, the company’s real-time settlement platform that uses XRP to provide on-demand liquidity and dramatically increase the speed of cross-border payments.
For payments between the US and Mexico, Ripple says financial institutions using xRapid saved 40-70% on what they would typically pay foreign exchange brokers. Here’s a breakdown on what those numbers mean for potential savings on global remittance payments per year.
According to the Pew Research Center, nearly $600 billion in cross-border payments are sent from relatives to loved ones in their home countries each year, at an estimated cost of about $30 billion. Applying Ripple’s estimates on the savings of each payment shows a savings of anywhere from $12-$21 billion a year.
Ripple has released its own breakdown of the numbers, using 55% as an average cost savings per remittance.
Financial institutions would have to pass the savings onto customers in order for the above savings on meals, bills and rent to be realized.
