American Express (AXP) and Santander (SAN) have joined forces with Ripple, a blockchain payment network, to provide an international payments system with same-day settlement, something that is frequently difficult for banking customers.
With this new program, which is not a trial but a full-scale rollout, American Express’s FX International Payments (FXIP) business will use the crypto company Ripple to make a transatlantic payment channel between the U.S. and the U.K. Initially, the channel is limited between the two countries.
“I believe this represents the first time any U.S. banking customers can move money internationally with same-day settlement, which is a huge financial and economic milestone,” said Logan Kugler, managing partner at General Crypto, a cryptocurrency investment fund. “Prior to this, the only way to move money from the U.S. to the U.K. same-day was to hop on a plane with a suitcase full of cash. But, that’s now finally starting to change.”
Santander and American Express executives have noted that blockchain technology, the same system that powers bitcoin, is able to make the formerly impossible possible.
“We’ve already seen evidence that blockchain technology is playing a transformational
role in the way customers are served,” said Greg Keeley, Executive Vice President of
Global Corporate Payments at American Express in a press release. According to American Express, the transactions aren’t just faster but are cheaper and are up to the company’s security standards.
“This blockchain solution opens up a new channel between the U.S. and the UK and presents significant opportunity for payments globally,“ said José Luis Calderón, Global Head of Santander Global Transaction Banking, in a press release.
Should this channel prove successful and expand, it could lead a shift in the industry towards further blockchain development.