Banking News Technology Media Telecoms

Ripple launches financing for XRP payments

ripple xrp

Yesterday Ripple unveiled its Line of Credit offering to provide commercial payment providers with working capital to buy XRP for use in its On-Demand Liquidity (ODL) solution. ODL is a RippleNet service that leverages XRP as a go-between currency to make cross border payments. Payment providers such as remittance firms find ODL attractive because it reduces the need to use correspondent bank accounts, which payment providers often struggle with. Most of the incumbent banks that use the RippleNet messaging service don’t use XRP or ODL.

Ripple has ample XRP to make these loans. It’s currently sitting on a stash of 6.2 billion XRP worth $1.55 billion.

In the announcement, Ripple said the solution has already been trialed with money transfer businesses, and it has opened a waiting list. The payment terms will likely depend on the applicant, but the website says a fixed repayment schedule will be arranged. When funds are repaid, more credit is automatically made available.

Ripple hasn’t been shy to back initiatives with significant funds. It set up an investment arm, Xpring, which spent $500 million within a year. Two of those were big layouts of $100 million into the gaming sector and $260 million into Coil, co-founded by Ripple’s CTO to provide content payments. Xpring has now morphed into RippleX, which provides technical tools to help developers integrate XRP into applications.

In other recent changes, XRP now has the XRP Ledger Foundation, a move aimed at distancing Ripple from XRP’s governance. We speculated that one of the purposes is to demonstrate that Ripple doesn’t control XRP, something which has been the subject of recent litigation.

Also last week, Ripple became a carbon free powered blockchain.