- The head of Swift Go has disclosed that banks are the first point of call when consumers want to make a cross-border payment.
- However, factors such as speed, ease of use, and transparency are the reasons for considering alternatives.
Cross-border payments have become an interesting section of global transactions as the ecosystem is expected to value around $250 trillion by 2027. In a recent discussion, Tanja Haase, Head of Swift Go explained what consumers and Small and Medium-sized Enterprises (SMEs) expect when sending money across borders.
In a survey that considered the inputs of 4000 consumers and SMEs across eight key markets, it was observed that banks are still “the first point of call”.The reason is that customers have a lot of faith in their process and security. However, some of the participants agreed to be using alternatives.
According to the survey, the main drivers for these consumers and SMEs that consider alternatives are bordered around speed, ease of use, and transparency. Haase further disclosed that Swift has been exploring means to support the community. Swift Go had about 400 banks signed up for the service last year. After a year, over 600 banks have signed up with 400 of them already live.
Recently, Swift announced that its Central Bank Digital Currency (CBDC) interoperability experiment has entered into a new phase as three Central Banks start beta testing the innovative solution. According to Swift, 30 financial institutions are experimenting with the solution.
We’re committed to developing a beta version of our CBDC connector solution after the first iteration of sandbox testing, with participants recognizing the solution’s ‘clear potential and value’. The beta solution has taken its next step, with three central banks and monetary authorities, including the Hong Kong Monetary Authority (HKMA) and the National Bank of Kazakhstan, integrating the solution with their infrastructure for direct testing.
Ripple and Stellar Join the Revolution
According to Tom Zschach, chief innovation officer at Swift, the focus is to ensure that CBDCs can coexist with each other including fiat-based currencies and payment systems.
To push the cause of ensuring that the payment system worldwide is revolutionized, Swift joined hands with Ripple and Stellar. Ripple’s XRP is said to accelerate global transactions and has been the most preferred in terms of speed compared to traditional financial systems. Stellar also focuses on faster and cost-effective transactions. Its official website mentions that its Interoperability is what distinguishes it from the other blockchains.
What sets the Stellar network apart from other blockchains is its interoperability. The Stellar network can interoperate with other blockchains and traditional financial infrastructure via regulated financial institutions called anchors. can issue assets and/or provide on/off ramps onto the Stellar network.
Ripple recently sealed a strategic partnership agreement with global e-commerce Amazon. This would integrate XRP into Amazon’s payment operations.
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Ripple’s XRP has been predicted to hit as high as $500 by 2027 with the assumption that it may dominate the cross-border ecosystem. As of press time, XRP was trading at $0.510923 after surging by $1.79 percent in the last seven days. In the last 24 hours, the asset has surged by 0.05 percent. XLM has also fallen by 4.7 percent in the last seven days to trade at $0.113852.