Ripple, SWIFT, Circle and JP Morgan are developing innovative cross-border payment solutions, says World Bank

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The World Bank published a blog addressing the need for a faster, innovative, and upgraded remittance system, suggesting that industry incumbents were working on a solution for cross-border payments.

Developing countries face a major roadblock when it comes to efficient remittances, which is a critical resource in emerging economies. According to the blog, personal remittances represent as much as 10.5% of the GDP of the Philippines, 13.7% of Senegal, 28.3% of Nepal, and 29.3% of Haiti.

Global remittances reached $613 billion in 2017 and grew by 4.6% in 2018 to a record a high of $642 billion. It was also mentioned that remittances were extremely expensive in Sub-Saharan Africa, with an average fee of 8.9%.

Industry incumbents like Ripple, SWIFT, Circle, and JP Morgan are developing innovative and efficient cross-border solutions using Distributed Ledger Technology [DLT], which reduces the cost of transactions considerably.

The blog added,

“In 2018, Ripple, a FinTech company, piloted xRapid, a DLT-based cross-border payments solution, along the very competitive U.S.-Mexico corridor. Financial institutions involved in the pilot saved 40%-70% in foreign exchange costs, and the average payment times was just over two minutes. The transfer of funds on xRapid took two to three seconds, with most of the processing time explained by domestic payment rails and intermediary digital asset exchanges.”

It also mentioned Circle Pay, which is presently available in 29 countries and allows seamless transfers between US Dollars, British Pounds, and Euros. Other players include SWIFT, which developed Global Payments Innovation and also implemented Proof-of-Concept using DLT to address Nostro account reconciliation issues.

Visa’s B2B connect was also mentioned in the blog as it was testing a DLT solution for B2B cross-border payments.  J P Morgan’s new creation, the blockchain-based coin, JPM Coin, was also mentioned. The company is presently trialing a DLT application that provides messaging, validation, and foreign exchange pricing services to improve customers’ cross-border payment experience.

Although a clear framework for DLT or cryptocurrencies wasn’t presented, the blog stated that DLT had a chance of disrupting cross-border payments industry, if it scaled effectively.


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