News through the grapevine indicates that Ripple could soon collaborate with Bank of America to launch a revolutionary global payment system. Besides Bank of America, JP Morgan could also join the payment system. Ripple has the potential to take significant market share from SWIFT & change the way money is moved globally.
BOA Head of Digital Strategy Talks Ripple, Nothing Confirmed Yet
Recently, Bank of America published a podcast in which Julie Harris, the Head of Global Banking Digital Strategy at the bank discussed payment systems and a possible partnership with Ripple. The discussion focused on emerging payment options in the financial sector that offer better speed and efficiency. According to Julie, they are collaborating with FinTech companies such as Ripple, which has passed their legal and compliance tests. She added that the bank was able to leverage its platform to deliver these futuristic solutions to its clients.
It’s worth noting that it’s rare for FinTech companies like Ripple to be in this position. Banks are extremely risk averse, which has stalled innovation. Ripple is one of the only FinTech companies in the Blockchain and Cryptocurrency space that has been on bank radars for years, as their CEO has stressed the importance of working with regulators.
However, she did not provide any more details on how the bank is going to work with Ripple. Since Julie mentioned Ripple in the podcast, it is safe to assume that an international payment system is part of their collaboration. The key rumor is that Bank of America could soon start using RippleNet. However, there are numerous other options for banks to work with Ripple and nothing has been confirmed thus far. Ripple also discussed the issue via a twitter DM that was posted by a user on Twitter, saying that nothing had been officially confirmed, but they were “excited about this news” that was leaked pre-maturely…
JP Morgan Could Also Be Part of the Initiative
In a recent article, JP Morgan all but confirmed that the legacy payment system could be replaced soon. The article talks about a new payment system in the US, the first of its kind in 40 years. JPMorgan’s article talks about Real-Time Payments (RTP) as being crucial to this new system. The system would offer instant confirmation, settlement finality, and integrated information flow. According to the article, the payments would be completed in seconds. The result is that the system will offer data, speed, and communication, helping to solve numerous problems with the existing system.
One of the solutions that the new system would offer in communication between the parties involved within the system. In the existing system, which payments are made within the SWIFT network, the confirmation of payments is made outside the system such as via emails. The result is that it could help to minimize the need for call centers, where parties send requests for confirmation of payments. There is a good chance that Ripple might be involved in this system since the article describes RTP as offering a “Ripple Effect of Benefits.”
BOA & JP Morgan Similarities
On Bank of America’s website, they discuss real-time payments in the form of creating the 1st new clearing operation in the United States in “40 years.” Anybody familiar with Ripple technology could see the direct connection in terms of the tech stack behind Ripple and the features that this payment system is proposing to offer.
JP Morgan almost had an identical proposal on their site regarding real-time payments. Their site mentions that “The first U.S payments system in 40 years is coming.” Until further confirmation, many will speculate that JP Morgan might also have plans to partner with Ripple in a similar capacity.
The Federal Government Appears Supportive of These Efforts
At the start of this year, we published an article in which the Treasury Secretary appears to support a crypto-powered cross border payments solution. When he was questioned about crypto-powered payment solutions, Steve Mnuchin said:
“There are benefits to cross-border payment systems in lowering costs for consumers and businesses. We absolutely support companies working on this.”
In addition, Steve Mnuchin showed additional support in digital companies during a recent press briefing on Coronavirus financial relief stating that:
“There are people who are underbanked.. We are working with all of the digital companies.. We’re working with all of them to make sure we have a process that every American gets their money quickly..”
The legacy banking system has remained unchanged for decades. There is no doubt that a Ripple-powered payment solution could help to revolution the current system. Various banks such as the National Bank of Egypt are already working with Ripple on such a solution. However, the real game-changer would be if Ripple partners with a major international bank such as Bank of America. While no official statement has been issued, all indications are that something major is in the works.
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