The Power of Instant Remittances: RippleNet in Japan
Since the dawn of time, humans have followed opportunity to provide for their families. Today, that means workers striking out from their home countries to find higher paying jobs elsewhere in the world. In 2017, a record 1.28 million foreigners were working in Japan alone.
Many of these workers are a primary source of income for family members living back home, making a remittance corridor from Japan to a worker’s home country a lifeline for needed cash. But an archaic international payments infrastructure — designed decades before modern payment technologies – can significantly inflate the time, hassle, and cost of sending this money for workers.
For the 45,000 Thai workers living abroad in Japan, a single payment transfer can take multiple trips to a bank to complete and require up to 12 extra hours of work just to afford the transfer fee. Even worse, the lack of a communication mechanism within traditional wire transfers and remittance services means these workers don’t know when a payment arrives or its final delivered amount. For families relying on this cash to buy groceries or pay rent, they are one mistake removed from financial disaster.
A number of pioneering banks and providers are using RippleNet’s global payments network to give workers an instant, affordable and transparent way to send needed cash to their families. One example is the collaboration between SBI Remit and Siam Commercial Bank (SCB) that leverages RippleNet to power real-time remittance payments for those Thai workers living in Japan.
Through this partnership, Thai workers can open an SBI Remit account online and then link it to a home account at SCB. Once they receive an SBI card, they can visit an ATM to make a deposit that is posted in real time to their Thai bank account.
With RippleNet’s pathfinding and instant settlement capabilities, money that is deposited in JPY at an ATM in Japan with SBI Remit is available to be withdrawn in THB in Thailand—mere seconds later. And because RippleNet lowers processing costs, workers can avoid high fees and send home more of the money they earn.
RippleNet’s messenger API also enables SBI Remit and SCB to exchange information on customers, fees, rates, and expected delivery time for unprecedented visibility into a transaction. This allows workers and their families to know costs and final delivery amount and times before money is ever sent.
Beyond customer benefits of speed, cost and certainty, the banks can add new capabilities and lines of revenue while deepening customer loyalty.
SBI was able to complete Ripple implementation within 3 months and is currently the largest money transfer provider in Japan with 10 billion JPY in cumulative monthly payment volume. SBI is building on the success of its service and the popularity of instant remittances by expanding its work with Ripple through the jointly launched Japanese Bank Consortium.
Comprised of 61-member banks and covering nearly 80% of banking assets in Japan, the Consortium recently unveiled a first-of-its-kind mobile app powered by RippleNet called MoneyTap. This app allows customers of consortium bank members to settle domestic transactions instantly.
Whether for international remittances or domestic transfers, for providers like SBI, SCB and the members of the Japanese Bank Consortium, the business implications of using RippleNet are enormous. But for the millions of workers in Japan and their families back home, the technology is life changing.
For more information on Ripple’s solutions or to learn how to join RippleNet contact us.