Cory Johnson, the Chief Marketing Strategist at Ripple Labs Inc recently appeared at the MI Global Summit, held by the Milken Institute of California, wherein he spoke about Ripple’s cross-border payment solutions and its differences from the existing systems.
Cory Johnson stated that Ripple was very focused on solving the “huge problem” of moving money across borders. He stated that in an era where people can send text messages from a place like Singapore to Rome in three seconds, it was not possible to send money across the border earlier than three to five days for less than 500-600 basis points with an error rate of 600 basis points.
The term “basis point” was used by Johnson to indicate a unit of measure used in finance to describe the percentage change in the value or rate of a financial instrument.
Johnson went on to say:
“As you know for all of the globalization that we have with our stuff and goods that gets shipped in containers all over the world and all the globalization of our data which is instantaneously moving all over the world at super low cost, we move money like it’s 1973 and that leg of globalization hasn’t happened.”
He further stated that Ripple was 100% focused on making payments faster and allowing banks and financial institutions to transfer money across the border in less than a minute or two for basis points.
Giving an example, he stated that Ripple’s customer in Mexico saw the cost go down from 400 basis points to 40 basis points and transfer time reduce from three to four days to two minutes. That was the kind of change that was possible using Ripple’s solutions, he added.
He also stated that the marketplace was beginning to accept that cross-border payment solution was a popular topic and the place where the pace was increasing. However, he stated that Ripple was well ahead of all the other projects that were in the market offering similar solutions. Additionally, he stated that the company has got a hundred customers in production and that no other company had reached that level yet in the blockchain industry.
According to Johnson, the importance of additional features like transparency and predictability that Ripple offered depended on the customer’s interest. He stated that there were a few notable features that were different from the “state of the art of Swift”. He also said that Swift was a 1973 technology that only sends one-directional messages. There was no way of knowing the number of stops it makes on the way and the cost involved, he added.
On the contrary, he said that Ripple’s customers were “thrilled” that they have accuracy and an added advantage of bi-directional messaging that allows them to know what was happening. He concluded by stating that knowing the price and how quickly it was going to happen was the real game changer for their customers.