Malaysian banking giant, CIMB Group, which is also the fifth-largest ASEAN bank, has recently joined RippleNet. RippleNet is a consortium of over 100 financial institutions who pledge to use Ripple’s blockchain-based products.
As part of the strategic alliance, CIMB and Ripple will work to establish instant cross-border payments in the ASEAN market. Since past several years, payment systems in the ASEAN market have been lacking behind. Compared to other regions, ASEAN countries always used slow and inefficient payment systems.
CIMB is the first ASEAN bank to adopt blockchain technology to facilitate cost-effective and instant cross-border global payments. Tengku Dato’ Sri Zafrul Aziz, CEO of CIMB Group, expressed optimism on joining RippleNet. Aziz emphasized that this partnership will help both companies to leverage each others’ capabilities.
“We are delighted to be part of RippleNet and look forward to a fruitful partnership with Ripple by leveraging each other’s strengths and capabilities. This innovative blockchain solution will revolutionize international cross-border remittances, and is a testament to CIMB’s ongoing efforts to enhance its digital banking proposition by providing speedy and cost-efficient solutions to our customers across ASEAN,” said Aziz.
Huge Potential for CIMB In the ASEAN Market
According to the World Bank report, remittance services in South East Asia will touch $120B USD. Currently, according to BCG, the global payments volume is around $27T USD. This is further likely to grow by another $20 trillion USD in the next eight years. Moreover, the ASEAN region is likely to capture a whopping 39% of the global market. This shows that the bank can leverage the first-mover-advantage to gain strong dominance in the ASEAN arena.
The official blog post by Ripple says that CIMB is also looking to improve its proprietary remittance product SpeedSend using Ripple’s blockchain solutions.
It will allow CIMB customers to send/receive money using instant cash collection and direct account crediting. It will also help CIMB to extend its reach of cross-border remittance beyond ASEAN region to other global markets. The bank is already working to establish remittance corridors into USA, UK, Australia, and Hong Kong.
Ripple CEO, Brad Garlinghouse, said that a number of global financial institutions are slowly adopting efficient blockchain system for low-cost and instant cross-border payments.
He further added,
“CIMB’s network already spans 15 countries, nearly 800 branches and offers Speedsend — one of the best solutions in the ASEAN region. Now, by integrating Ripple’s blockchain technology, they will enable their customers to send vital funds to family, friends and loved ones more efficiently. With its focus on innovation, CIMB will continue to be a dominant force in the region for years to come.”
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