Team Ripple recently released a blog post on their ‘Insights’ blog about the cost savings and benefits of their premier offering, xRapid. They also spoke about their vision for the Internet of Value and how xRapid fits into it.
They stated that realizing their vision of the Internet of Value depends on two thresholds. The first is that money can move instantly like information, and the second is that this occurs at little to no cost.
“While the economic potential for this vision has vast industry implications, it’s perhaps more important to evaluate its impact on the end user.”
They then went on to explore the effect that xRapid’s savings might have on families around the world. Even as the fees associated with global payments near approximately $30 billion a year, a majority of these payments average about $500.
This data was then collated with data on the genesis and destination of these payments, which led to the conclusion that these payments are made by breadwinners working abroad sending money to their families.
As financial institutions who use xRapid save 40-70% on cross-border transactions, the savings can be passed down to customers who engage in remittance payments. This would result in a lasting and stacking impact on the lives of families. Ripple said:
“As more companies adopt this type of technology, we expect cost savings, along with a better payment experience, will be passed directly to the user. In economics, this is the idea of “perfect competition.” It means no one company can control price, and ultimately, consumer benefits.”
To accurately gauge the effect that these savings have on families across the world, Ripple collated the savings made by using xRapid with the cost of living in 5 countries. The savings in question were assumed to be a 55% savings off the $30 billion cost of remittances. The countries explored were India, China, Philippines, Mexico and Pakistan.
They found that these savings could provide 3.27 billion meals, at a cost of $4.13 per meal, and 263.07 million monthly bills, at an average cost of $51.32 per month. They also discovered that 49.9 million families could pay rent at an average of $273.34. They said:
“These benefits illustrate just some of the ways in which lowering the cost of remittance payments could have major positive impacts on real people.”
Yoshitaka Kitao, the CEO and President of SBI Holdings, said on Twitter:
“We will persevere and move forward. As such, new amazing opportunities are already presenting itself…”