The Filipino diaspora is one of the ten largest in the world, with more than five million of its citizens living abroad.
Many of them, like Joyce de Guzman, live and work in a foreign country so that they can send money home to their family members. But the traditional system of international payments for these migrants is often slow and expensive, sucking valuable funds out of every transaction that could be better used for groceries, rent or medical bills.
For those Filipinos fueling the $ 1.8 billion remittances that flow from Japan to the Philippines each year, this can be an especially painful transaction. The Philippines is the third largest destination for money transfers from Japan, with Japan (10.50%) having one of the highest transfer costs in the world – almost double the average for all G8 countries (5.92%).
Now, SBI Remit Co., Ltd, the largest money transfer provider in Japan, is partnering with Coins.ph mobile payment service and SBI VC Trade digital asset exchange platform to transform transfers from Japan to the Philippines. Using on-demand liquidity, the three customers offer faster, less expensive remittance options.
This is Ripple’s first implementation of On-Demand Liquidity (ODL) services in Japan, which creates the conditions for greater adoption of crypto-enabled services in the region. By using the XRP digital asset to eliminate pre-financing, the two companies can also free up capital and accelerate the expansion of their own payments business.
“We see enormous potential in the use of blockchain technology to change not only the way in which payment transactions are made, but also the way in which we run our business by freeing up trapped capital,” said Nobuo Ando, Representative Director of SBI Remit. “The introduction of ODL in Japan is just the beginning and we look forward to continuing to push the next frontier of financial innovation beyond real-time payments only in the Philippines but also in other parts of the region.”
If you zoom out, this deal is part of Ripple’s explosive growth in the greater Asia Pacific (APAC) region. With e-commerce growing in clout, an increasingly mobile population, and increasing clarity about cryptocurrency regulations, the Asia-Pacific region is one of the fastest growing regions for Ripple, with transactions increasing 130% year over year.
The news also follows similar partnerships with companies like Novatti and Tranglo, as well as Ripple’s recent hiring of finance and technology veteran Brooks Entwistle as Managing Director for Southeast Asia. Looking ahead, Ripple is perfectly positioned to meet APAC’s growing need for faster, more cost-effective approaches to cross-border payments today, while preparing regional players for the broader business transformation into an already-well-tokenized future.
If you’re a financial institution and want to learn how ODL can help you make instant cross-border payments in your area, contact us today.