Spanish banking giant BBVA executes a money transfer using Ripple’s blockchain technology to send real money between Spain and Mexico ‘in a matter of seconds.’
Spain’s second biggest lender (after Banco Santander) has laid claim to the ‘first real-time implementation of an international money transfer using San Francisco-based Ripple’s new distributed ledger’ or blockchain technology.
In its announcement, BBVA adds that the successful real-world test would significantly improve customer experience in transactions involving Latin American corridors, a region where the bank has a significant presence with its subsidiaries.
In addition to cutting down transaction times from 4 days to seconds, BBVA is promising transparency in costs and payment statuses for customers at any point during the conversation. Ripple’s blockchain platform enables permanent timestamped records with the integration of messaging and settlement functionalities on its network.
Alicia Pertusa, head of digital transformation in investment banking at BBVA stated:
This pioneer initiative is a clear demonstration of how payment processes can be vastly improved through the implementation of emerging technologies. These improvements will benefit our clients’ transnationality
The real-world money transfers saw 50-euro denominated payments to Mexico from Spain in seconds, a Bloomberg report revealed. Ripple estimates that costs using its blockchain network would be, on average, 81% fewer than current costs incurred by banks in an international transfer using Swift’s decades-old messaging network.
BBVA will reportedly offer Ripple’s blockchain money-transfer feature for corporate customers. There are no details about a commercial rollout for everyday banking customers.
BBVA’s interest in blockchain innovation has been evident since 2015 when it joined the R3 banking blockchain consortium led by the namesake New York-based startup.
Earlier this year, BBVA joined a number of other banks and technology companies as one of the founding members of the Enterprise Ethereum Alliance. Soon enough, the bank completed its round of memberships in three of the major global blockchain consortiums around. Last month, BBVA became a member of the Hyperledger Project, an open-source cross-industry blockchain collaborative led by the Linux Foundation.
Meanwhile, Ripple’s new features unveiled this year has helped push its XRP token to reach an all-time high, with the FinTech firm claiming transaction throughputs at the levels of the world’s largest payments network, Visa.
“XRP saw nearly 70k transactions with an average time of 3.7 seconds,” a Ripple representative told CCN earlier this month.
Ripple has also partnered Japan’s largest bank, MUFG, adding the banking giant to its global roster of 90 partner banks participating in its payment network. Unlike BBVA, the Japanese banking giant is expected to rollout its Ripple blockchain money-transfer feature commercially for individual users before offering it to corporate clients in 2018.
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