June 28, 2019 – An executive of blockchain-based platform Ripple said that while technology is existing to bring remittance costs down, the Philippines is not yet taking full advantage of it. He has urged the country to conduct steps to make remittances more efficient.
In an interview with local paper BusinessWorld, Ripple Senior Vice President of Global Operations Eric van Miltenburg said that at present, remittances to the Philippines still experience slow transfer time and higher transaction costs. These costs, he said, are significant, “around 7% for every $200 sent”.
He said technology must be leveraged to make this faster and more cost-efficient.
Ripple, which leverages blockchain technology to enable cross border money transfers faster and with minimal costs, is already partner to multiple companies wanting to tackle the problem of sending money to the Philippines. SendFriend, a US company uses Ripple’s platform for remittances from New Jersey to the Philippines. A cryptocurrency exchange in Korea also uses Ripple’s Xcurrent Technology for remittance to the Philippines, which can be encashed in Cebuana Lhuillier outlets.
Mr. Miltenburg notes that Cebuana Lhuillier is a Ripple partner. He also said they are working with a local bank but declined to identify it by name. Ripple recently acquired Moneygram, a last mile* remittance outlet with thousands of branches worldwide.
*Last Mile refers to the last connection before the money gets to the recipient’s hands. Moneygram, Western Union, and Cebuanna Lhuillier provide last mile access for money sent from abroad or from another person in the Philippines.
He also recognized the role of cryptocurrencies for faster and cheaper transfer of money. Ripple’s XRP, at this time one of the top 5 cryptocurrencies globally by market cap, is used for cross-border transactions. When BusinessWorld asked if people will lose some value because of the coin’s volatility, he argued that since transactions are almost instant, there is very minimal volatility during the moment of conversion and when the end user receives the money. He argues there is much more volatility between PHP to USD versus using XRP.
This article is first published on BitPinas: Ripple: PH Must Take Steps to Make Remittances More Efficient