$XRP supports Ripple's bold challenge to the outdated SWIFT payment system by providing lightning-fast, low-cost, and transparent cross-border transactions through innovations in blockchain and stablecoins.
Ripple presents an XRP-based solution while SWIFT struggles with outdated payment rails.
Ripple shared in a blog on May 28 that blockchain technology and the digital asset XRP can help address many longstanding issues with cross-border payments, particularly those related to the Society for Worldwide Interbank Financial Telecommunication (SWIFT) system. The company highlighted the fragility of traditional rails, where manual processes still dominate global money transfers:
Most cross-border payments still rely on manual processes. A typo in the account number, an incorrect SWIFT code, or incomplete payment instructions can lead to transaction failures.
"Failed payments not only waste time but also incur costs, create operational difficulties, and can strain relationships with partners or clients waiting for funds. Reducing manual actions and increasing automation is key to minimizing these risks," noted Ripple.
The cryptocurrency company emphasized that these outdated systems, which typically rely on numerous intermediaries and correspondent banks, are prone to delays, errors, and lack of transparency. Payments may pass through five institutions before reaching their destination, adding uncertainty and increasing fees. This system, according to Ripple, does not keep pace with modern commerce and the growing needs of companies operating on a global scale. Inconsistent messaging standards, currency exchange markups, and regulatory complexity all contribute to what the company describes as an inefficient and risky ecosystem for cross-border transactions.
In response, Ripple promotes its blockchain-based solution Ripple Payments as a modern alternative. "Ripple Payments provides a solution for cross-border stablecoin payments that is a modern alternative to traditional cross-border payment rails," the company explained, clarifying:
It uses blockchain and digital assets such as $XRP and stablecoins like Ripple USD (RLUSD) to provide businesses with a powerful solution for fast, reliable, and affordable sending and receiving stablecoin payments worldwide.
With access to a global payout network covering more than 90% of the world's currency exchange markets, Ripple claims that its platform offers real-time settlement, transparency of fees, and reduced operational risk. While critics continue to raise questions about the regulation of digital assets, Ripple and other blockchain advocates argue that distributed ledger technology offers a faster and more inclusive future for international payments.
