Fintech hot news: Western Union Embraces Ripple Blockchain - Opportunity for Cryptocurrency Remittance and Payment
Blockchain and cryptocurrency are popular words today for crypto fans. The transfer of money as well as payment in crypto is not new to those interested in this technology.
However, with some countries still not recognizing and accepting cryptocurrency as a method of payment or money transfer, the application of these currencies is still a huge problem that needs to be solved.
Understanding that problem, Western Union has combined with Ripple to bring the most optimal solution and at the same time increase the volume of money transactions. What is this combination? Let's find out with FinFan through the following article.
Western Union - A long-standing remittance platform with a history of more than 150 years
Western Union experience in cross-border transfer field
With coverage in over 200 countries and territories and a history of over 150 years, Western Union has become a very famous company in the field of cross-border money transfer.
This year's revenue is more than 1.1 billion US dollars as of the end of June, Western Union has established itself as the industry leader in cross-border remittances.
It can be said that today, just walking around the living area, you can see Western Union's transaction points.
The development of technology in cross-border money transfer.
However, the feature that makes many people hesitate to use Western Union's services is their technology update.
When technology businesses began to offer solutions to help senders and recipients save time and money while also allowing them to transmit and receive money across borders in a more convenient manner.
In addition, the strong development of cryptocurrencies in recent times has also affected Western Uninon's revenue.
For example, sending money to Vietnam is a typical example. Although the epidemic situation is very stressful, the volume of money transferred to Vietnam has not decreased sharply but increased sharply.
This partly shows that customers during the time of the pandemic and the ongoing double crisis have been increasingly updating technology and always finding ways to transfer money as quickly and as cheaply as possible.
There was a point when the financial giant’s quarterly income declined by more than 200 million USD in the second and third quarters of 2020, and there hasn’t been a signal to return to the old milestone of more than 1.3 billion USD on average.
Competition with MoneyGram and Western Union's decision to participate in cross-border crypto remittances.
It can be said that, when cryptocurrency was not born, Western Union and MoneyGram were two strong competitors in the cross-border remittance segment (like Pepsi and Coca-Cola in the beverage industry).
If Western Union's revenue is about $1.1 billion in the first 6 months of 2023, the revenue of its direct competitor, MoneyGram, will also reach $ 1.34 billion.
So, when the crypto industry's giant, Stellar, chose to invest in MoneyGram in order to revolutionize the game of cryptocurrency money transfer, Western Union has been considering how to get into the highly developed field. rapidly by collaborating with Ripple to develop a new service for people.
Cooperation progress between Western Union and Ripple
*This strategic move was unveiled by CEO Hikmet Ersek during an analyst conference call, where he revealed Western Union’s active exploration of integrating Ripple’s blockchain technology and its native digital asset, XRP.
Ripple confirmed a longstanding collaboration with Western Union, stating the company has been “engaged in testing various solutions” with Western Union.
Among these innovations is the much-discussed xRapid, a solution designed to seamlessly incorporate XRP into payment systems.*
Opportunity for Cryptocurrency Remittance and Payment
Two titans of the cross-border money transfer market showing interest in cryptocurrencies is encouraging for the future growth and potential contribution of these cryptocurrencies to the cross-border money transfer market.
Although they have been on the market for many years, these cryptocurrencies are best known only through trading on exchanges and are not used much in payments and cross-border remittances.
However, due to its impact on the market when two titans of the sector opted to enter it, many businesses would switch to or add cross-border payments and remittances in cryptocurrency.
For those countries that have not yet recognized cryptocurrencies, Ripple partnering with Western Union or MoneyGram invested by Stellar will open the door to transferring money from crypto to fiat into those countries and vice versa.