- Ripple’s blockchain solutions simplify global payments, helping SMEs overcome challenges of outdated systems.
- Local banks can leverage Ripple to offer faster, transparent cross-border transactions, gaining a competitive edge.
- The B2B payments market is set to reach $174.2 trillion by 2030 with Ripple positioning banks to capture this growth
Ripple has been strategizing itself as a company of solution for the SMEs needs when it comes to payment services across the globe. Since SMEs now seek international markets more for growth, 50% of them do more cross-border business than in the year 2021. This growth has highlighted the difficulties that were experienced with the traditional and outdated payment systems.
According to Mastercard’s 2023 Borderless Payments report these inefficiencies result in more than $17 trillion annually in cross-border payments. Nevertheless, this is done in large volumes, and yet it is slow, costly and there is little transparency in the whole process.
Ripple Empowers Local Banks
The Ripple’s report proves that local banks can influence and enhance their services provided to SMEs by implementing blockchain-based payment options. Ripple allows enabling and simplifying payment processes, minimizing costs, and making it easier to track them providing competitive advantages in the market for small financial institutions against large
banking giants that used to dominate the market.
Currently, SMEs especially are struggling to undertake many challenges such as inflation, geopolitical tension and shock in supply chain. These difficulties are further compounded by outdated payment systems that introduce long settlement times, high fees, and unclear transactions.
Across borders transactions could take 3 to 5 business days to get cleared and this have impact relationships through vendors and suppliers, reduce cash flow and at long result to loss revenue. Another uncongenial characteristic related to high risks is hidden fees that tend to bring an added 2-3% to the cost of every transaction made.
The same goes for tradition means of payments which always lack transparency. SMEs who depend on large banks do not have much information about the progress of their transactions especially during non-business hours. This uncertainty make managing of international payments even more challenging, particularly for firms that have many constraints of finance.
Ripple’s Solution for Local Banks
Local banks still have a possibility to include innovative payment systems into the existing framework. Through Ripple Payments, banks would be able to provide faster and more reliable cross border real-time transactions at a minimal cost and with full disclosure. Such services stick with the international regulations of Anti Money laundering (AML) /Counter financing of terrorism (CFT) so that the transaction is very secure and smooth.
The shift also provide the local banks a chance to create competitive advantages that enable the provision of quality services to SMEs. The importance of the B2B payments market continues to grow, and it should reach $174.2 trillion by 2030, Ripple’s blockchain can be a tool to find a new way of development. That it could assist SMEs to overcome the difficulties of the worldwide market and at the same time generate revenue for the financing establishments.
