International payments firm Ripple today announced a partnership with Malaysian and Bangladeshi mobile finance firms to enable faster and cheaper payments between the two countries.
Malaysian mobile finance firm Mobile Money will connect with Bangladesh’s largest mobile financial services provider bKash—and its 45 million customers—via the RippleNet system.
The partnership comes at a good time for Ripple, which is struggling with a lawsuit by the U.S. Securities and Exchange Commission over what the agency claims are illegal sales of XRP, which it calls an unregistered security. As a result of the suit, most major U.S. cryptocurrency exchanges have suspended trading of XRP, which powers another Ripple product, On-Demand Liquidity (ODL). Exchanges in other countries have not followed suit.
Ripple, which has promised to vigorously fight the lawsuit, has said that most of the trade in XRP is based outside the U.S., so the suit will not seriously affect the liquidity of the fourth largest cryptocurrency by market capitalization.
Cost and convenience
BKash CEO Kamal Quadir said the partnership with Ripple will let it “deliver a cost-effective, fast, transparent and reliable remittance sending experience to more than 10 million non-resident Bangladeshis all over the world.” He added:
Mobile Money founder Eng Sia said his firm expects a 20% increase in its user base thanks to the improvements in speed and cost RippleNet will bring, including wallet-to-wallet transfers. These will be settled by Bangladesh’s Mutual Trust Bank.
Noting that the pandemic and its economic impact has made the need for better remittance solutions more important than ever, Sia said “[o]ur focus has always been on providing simple, cost-effective and convenient e-payment solutions to our customers.” He added:
“Our partnership with Ripple makes us one of the first few e-wallet companies to offer such digital remittance solutions to Bangladeshi workers, and we’re confident that it will enable us to stay ahead of the competition while expanding our user base.”
Bangladesh is the world’s eleventh-largest recipient of remittances sent home by overseas workers, and the third-largest in South Asia, Ripple said. Malaysia is among Bangladesh’s top five sources of remittances.
In 2020, Bangladesh received $18.2 billion in remittances, with the majority coming from Malaysia, the Middle East, and the United States, according to Syed Mahbubur Rahman, managing director and CEO of Mutual Trust Bank.