China’s card payment market has shown consistent growth in the last few years and is likely to show more by 2019. Noting the huge potential, U.S. giant American Express is looking to venture into China’s market, via its utilization of RippleNet.
AmEx is entering China through a joint venture with the LianLian Group. This joint venture will operate under the name of Express [Hangzhou] Technology Services Co. Moreover, the Chinese government has asked the JV to complete its preparation within a year’s time.
The approval allows AmEx and LianLian to set-up their own network while processing and settling their payments in CNY domestically. This is the first venture whose payment processing won’t happen through the state-controlled UnionPay network.
AmEx and LianLian – Part of RippleNet
To note, both AmEx and LianLian Group are part of Ripple’s global payment network RippleNet. Last year, AmEx joined RippleNet to help Small and Medium Enterprises (SMEs) easily move money globally. The LianLian Group joined RippleNet earlier this February and now has more than 150 million registered customers.
With last year’s crypto ban, China maintains a strict policy on cryptocurrencies. Hence, Ripple’s xRapid payment solution powered by XRP tokens holds no chance of making it to the Chinese market. However, the Chinese government is quite open to fostering DLT and blockchain-related projects.
As a result, Ripple’s other product offerings like xVia and xCurrent, which are solely based on blockchain can be considered as valid.
The Full-fledged Tapping of RippleNet Capabilities
Both AmEx and LianLian are independently working to expand their cross-border payment services. This will further trigger the full-fledged utilization of RippleNet’s capabilities. RippleNet’s multi-hop feature gives some insight regarding its network capabilities.
Ripple’s Director of Product Craig DeWitt says, “Multi-hop gives Ripple members the ability to transact with banks or payment providers or digital wallets that they don’t have a direct relationship with. That’s important because in today’s world you need a bunch of bilateral relationships clunkily put together in a chain in order to move money. Multi-hop makes that a thing of the past.”
On the other hand, Ripple is making every effort to push forward its xCurrent payment solution in the global market. The company is making important partnerships with several global banks and payment services across Asia, the Middle East, Europe and other parts of the world. Ripple’s Senior VP of Product, Asheesh Birla explains how xCurrent manages to have a global reach.
“xVia allows you to use a one standard connection to get you all the benfits of RippleNet and our products,” he said. Without xRapid they would use xCurrent and where xRapid is available, they can then add on xRapid and move money on demand using XRP and payout instantly. They get reach wherever xCurrent is available, whether that be a bank [or] a cash payout provider.”
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