Popular cross-border payment platform MoneyGram has announced that blockchain partner Ripple has made the final $20 million payment as part of its investment in its equity platform. We had earlier reported the huge development that occurred when Ripple agreed to pay $50 million in exchange for equity shares in MoneyGram.
The partnership which allowed Ripple to gain much-needed exposure in the mainstream financial market has continued to blossom. The $50 million paid by Ripple is expected to be used to fund MoneyGram’s operations as the company increases the use of Ripple solutions that leverages XRP for cross-border transactions.
Since the partnership announcement, MoneyGram has used Ripple’s on-demand blockchain solution to move around 10% of its Mexican Peso forex volume.
MoneyGram has also extended the Ripple backed solution to four additional cross-border corridors which would include, Australia, Europe, and the Philippines.
It is understood that there are plans to extend the services to more corridors by 2020 following the initial success in recent months.
MoneyGram is Focusing on xRapid
The collaboration focuses on xRapid product, a cross-border solution that offers on-demand liquidity, thereby reducing excessive reliance on pre-funding of bank accounts.
xRapid enables funds to be moved from one currency to another, in a fast and seamless manner to any destination across the globe.
The solution makes use of the native currency of the XRP Ledger, XRP, a digital currency that is said to be the most efficient for cross-border payment.
Transaction fees when XRP is used for cross-border settlement is way lower compared to what is obtained in the remittance world today where nothing less than $30 is charged for every transaction.
Ripple Partnership: One Of The Biggest In The Blockchain Industry
Ripple’s investment in MoneyGram is the biggest made by a blockchain firm in a major financial institution. Ripple made an initial investment of $30 million in MoneyGram equity and signed a partnership that would make the financial payment giant use its solution for cross-border transactions.
Ripple paying the remaining part of its initial investment shows the commitment that the blockchain firm has to its cause. Ripple will own 9.95% of the outstanding common stock of MoneyGram with the agreement in place and also hold non-voting warrants in the firm.
Ripple continues to show that it intends to hold its position as the major blockchain platform for financial institutes. Its platform has been integrated by top financial institutions and MoneyGram would undoubtedly help it spread to more countries across the world.