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Ripple Labs is now part of the ISO 20022 standards body that is working on the establishment of a new data standard for payments between financial institutions.
Ripple Labs is now a team member of the ISO 20022 standards body, whereby it claims to be the first member focused on Distributed Ledger Technology. According to a post on its official webpage, ISO 20022 is adopted in 70 countries and an estimated 87% of global financial transactions will be supported by 20022 by 2023.
Ripple and ISO 20022
Ripple customers will be able to enjoy the cutting edge technology through RippleNet and its ISO 20022 membership. Among the noted advantages by Ripple include being able to access a network of global financial institutions governed by rules and functional standards.
Its customers will also be able to leverage software to enable fast, transparent and seamless cross-border payments. Besides, they will also be able to connect to one standardized API for all counterparty connections.
“It is our duty to continuously search for superior technology solutions to deliver ever improved remittance services for our customers. With the steady rise of remittance flows, we see Ripple helping us open up a better overall experience for our customers.” Said Mr. Nobou Ando, Representative Director at SBI Remit Co. Ltd
In a stunning turn of events, one of the biggest expected beneficiaries of the deal will be XRP, which is the crypto token used by RippleNet in its ODL. Even though not all financial institutions are using the ODL, the ultimate goal is to make cheap, fast and secure transactions that the ODL, RippleNet and ISO 20022 are promising.
ISO 20022 is an emerging global and open standard for payments messaging. It helps create a common language and also a model for payments data across the world. It also aids in providing higher quality data, adapts to new needs and new approaches, and is not controlled by single interest.
Ripple Outshines Swift
Ripple has outshined its market competitor Swift, which has delayed its ISO 20022 migration date from November 2021 to the end of 2022. In a letter obtained by a news outlet Finextra, it shows an exchange between the ECB and Swift regarding its responsibilities to mitigate risks emanating from its delay to migrate.
Swift will be accountable for the creation of updated market practice and message usage guidelines for ISO 20022 cross-border payments. It will also offer free validation software for cross border payments traveling through European payments markets.
In addition, Swift will be expected to offer free translation software for cross border payments that have to be mapped from ISO 20022 to MT. Swift will be responsible for the creation of an opt-in solution for ISO 20022 cross border payments.