Western Union has officially confirmed they are trialing Ripple’s xRapid solution. This is big news for both companies, as improving liquidity in the remittance sector is direly needed. Especially if this also leads to lower fees for users and service providers alike, things can only improve from here on out.
WESTERN UNION OFFICIALLY EMBRACES RIPPLE’S XRAPID
Most people in the cryptocurrency industry have rather mixed feelings when it comes to Ripple and their XRP asset. This company is looking to work with banks and other financial service providers, which is in stark contrast to decentralized cryptocurrencies. Even so, most people acknowledge XRP has some potential, assuming enough financial service providers make use of this asset. It now appears Western Union is officially experimenting with Ripple’s xRapid solution.
A relationship between the two companies has been hinted at for months but was never officially confirmed or denied. Last week, Western Union publicly confirmed they were looking into the xRapid solution for lower-cost liquidity. Being able to settle domestic and international payments in seconds for virtually no fee is of great interest to one of the world’s leading money transfer service providers.
For now, the service provider is mainly focused on new opportunities regarding processing, settlement and working capital optimization. Blockchain technology has been of great interest to Western Union for some time now, even though there are still some concerns over the regulation and compliance aspects of this technology as of right now. Some of their tests are being done with Ripple’s xRapid, yet that doesn’t mean it’s the only partner they are working with in this regard.
Whether or not this means Western Union will ever use xRapid – and XRP – for real-world purposes is difficult to determine. Conducting trials with a technology provider is not a binding contract by any means. It’s possible Western Union may not like what they see after all and decide to use a different blockchain service provider altogether. While xRapid has a lot of benefits, it remains to be seen whether or not this technology will ever make an impact on the global financial system.
This announcement by Western Union comes at an interesting time, though. One of Western Union’s main competitors announced their interest in xRapid earlier this year. MoneyGram officially confirmed they saw merit in both xRapid and XRP for money transmission services, even though there hasn’t been any further communication since these “trials” began. MoneyGram seems closer to actually using this solution than Western Union, but time will tell how things evolve.
No one will deny that financial service providers can profit from faster and more liquid solutions. Whether or not that means they will opt to choose Ripple’s xRapid is a different matter altogether. The technology appears to be very cost-efficient and scalable, which are two main selling points for most service providers. A successful pilot never guarantees an actual use case for any technical solution, though.