Major money transmission network MoneyGram has entered into a strategic partnership with blockchain-based payments firm Ripple, according to a press release on June 17.
As part of the two-year agreement, the two firms will become partners in cross-border payments and foreign exchange settlements with digital assets. As part of the agreement, MoneyGram will be able to draw up to $50 million dollars from Ripple in exchange for equity.
MoneyGram will purportedly use Ripple’s xRapid liquidity product, which allows money to be sent in one currency and instantly settled in the destination currency. In using Ripple’s XRP token for such transfers, xRapid can purportedly settle such transactions faster than with fiat currencies or other major digital assets. MoneyGram Chairman and CEO Alex Holmes said:
“Through Ripple’s xRapid product, we will have the ability to instantly settle funds from U.S. dollars to destination currencies on a 24/7 basis, which has the potential to revolutionize our operations and dramatically streamline our global liquidity management.”
According to its website, MoneyGram is the second largest payments firm in the world, operating in over 200 countries. Much of MoneyGram’s business is in the global remittances market, the value of which is estimated to be worth $600 billion.
In March, India’s Federal Bank (IFB), a commercial private bank, partnered with Ripple to use its network for cross-border remittances. The partnership was part of an initiative to apply new technologies to IFB’s remittances network, having also launched two platforms in the United Arab Emirates for making payments to India.
Earlier this month, Ripple launched a Brazilian office with the goal of expanding across Latin America. Luiz Antonio Sacco, former CEO at the Brazilian subsidiary of global warranty solution provider The Warranty Group, will reportedly lead the new office.