Not quite long ago, Ripple came into partnership with one of the biggest payment transfer service providers, MoneyGram. Ripple invested the sum of $30 million in the global money transfer company.
The purpose of this investment is to make Ripple and MoneyGram partner on cross border payment and foreign exchange settlement using digital assets.
This partnership allows Ripple to have an initial term of two years to become a MoneyGram global partner. It also agrees to make a capital commitment to MoneyGram that allows it to draw up to the sum of $50 million in exchange for equity for two years.
This strategic partnership shows Ripple is using MoneyGram as a liquidity booster for xRapid Corridor only. It is also possible for Ripple to leverage on this opportunity in opening more corridors, but obviously, they are not thinking in that direction now.
The benefit of Ripple Partnership With MoneyGram
Though there is a limit to the advantages of this partnership there are gains in other ways. Ripple is boosting liquidity using MoneyGram, which has the liquidity but not the technology to upgrade its cross-border payment services. Ripple technology powered by the blockchain seems handy for the global payment service provider to achieve its aims.
Slashing of Price
According to a report on the transactions in the EUR – GBP corridor, a transfer of 4000 EUR which was normally charged a fee from $9.99 to $49.99 only cost only $0.99 EUR bringing the total cost to 4000.99 EUR.
Early this year, Ripple, BeeTech was able to reduce SWIFT fees for all its remittance corridors, dropping it from $20 to $2 per a transaction.
Through this process, BeeTech was able to save money for customers and grow its transaction volume. In a short time, its transactions were tripled working with another foreign partner, InstaRem.