In a significant development for cross-border payments, Ripple has partnered with Onafriq, a UK-based financial technology company, to expand remittance corridors throughout Africa. This collaboration is poised to streamline transactions between 27 African nations, the United Kingdom, Australia, and the Gulf States.
The partnership leverages Ripple’s private network, formerly known as RippleNet. Offering a faster and more cost-effective alternative to the traditional remittance process.
Notably, the private network, now called Ripple Payments, aims to solve the usual high fees and slow transaction reality of traditional remittances. By adopting Ripple’s solution, Onafriq will ensure quick and secure transfers, particularly benefitting the African diaspora who regularly send money back home.
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It is important to say that, despite some already observed speculation in the cryptocurrency market, there are no mentions of the XRP token in this endeavor. Ripple, the company, and Ripple Payments, the private network, are all different things from the XRP Ledger (XRP), an open-source protocol and public network.
Ripple and Onafriq partnership for remittances
Onafriq’s choice of Ripple’s payment infrastructure underscores the growing acceptance of blockchain technology in financial services. This collaboration will provide much-needed relief to remittance senders who, according to the World Bank, face an average fee of 8.3% for sending money to Sub-Saharan Africa, compared to a global average of 6.4%.
Interestingly, Ripple’s platform guarantees a significant reduction in transfer costs and an improvement in transaction speed, leading to a more inclusive financial system for the involved regions.
Africa is adopting alternative payment solutions
Moreover, Ripple’s expansion in Africa comes at a pivotal moment when the continent is witnessing a surge in mobile money platforms and a burgeoning fintech ecosystem. With the digital economy rapidly growing, the partnership with Onafriq signals a positive move towards financial innovation and integration.
The new remittance pathways will enhance economic activities between these regions, offering a critical service for the approximately 25 million expatriates from these African countries living in the Gulf, the UK, and Australia.
This advancement serves as a testament to Ripple’s increasing footprint in the global payments industry and confirms the vital role of emergent technologies in shaping the future of financial transactions, particularly in developing regions where traditional banking services are less accessible.
