Numerous remittance companies look for ways to reinvent their payment rails. SendFriend is one of the few companies willing to experiment with non-traditional solutions. Utilizing Ripple’s On-Demand Liquidity has yielded promising results.
What is SendFriend Exactly?
With dozens of remittance service provider available globally, there are many companies which tend to be overlooked somewhat. SendFriend is one of those companies, despite a very marketable name. The company is looking to reinvigorate the money transfer business and gain a competitive edge by utilizing Ripple’s XRP.
Over the years, the company has focused its attention on embracing innovative technologies. Their choice to leverage XRP and the Interledger Protocol certainly creates a competitive ecosystem. Ultimately, the company wants to move funds internationally and on-demand. Through traditional solutions, that is virtually impossible.
Under traditional circumstances, it is possible for businesses to pre-fund accounts in the currency of the recipient. While that model may work for the bigger players, it remains a very costly endeavor regardless. For a company looking to provide on-demand liquidity, tying up working capital is not the best way to go about things.
Tapping Ripple’s Asset and ODL
SendFriend CEO David Lighton has taken a keen interest in XRP, the digital asset developed by Ripple, and their On-Demand Liquidity, or ODL. He sees the promise of building an international money transfer application that utilizes blockchain technology to its full potential. Moreover, the use of digital assets allows for cheaper, faster, and truly global remittance solutions.
By utilizing ODL, SendFriend can use Ripple’s XRP asset to bridge two different currencies. Sending a transfer in US Dollar and having the recipient pick it up in Singapore Dollars – for example – can be achieved within mere seconds. In this modern era, the use of instant payments has become more prevalent.
David Lighton further adds:
“What’s fabulous about blockchain and what Ripple’s product brings to the table is that you remove the need for that working capital. We can now source liquidity, on-demand and depress those transaction costs by up to 75%. Our goal is to pass on these savings to our customers. What that means is companies like Western Union can charge up to 10% to service a payment—we can get it done for 2%.”
Considering how the Philippines is a key region for SendFriend, any cost-reducing matters are crucial for all parties involved. The Philippines remains one of the “big four” remittance markets globally. Domestic regulators are also more open to the use of new solutions and even digital assets.