UAE-registered payment technology company Pyypl has joined hands with US-based real-time gross settlement system, currency exchange, and remittance network Ripple to launch an On-Demand Liquidity or ODL service in the Middle East, according to a statement.
ODL is the process of buying and selling XRP — the native cryptocurrency of products developed by Ripple’s creator Ripple Labs — in originating and destination countries.
According to the aforementioned statement, ODL leverages XRP for instant and low-cost cross-border payments, eliminating the need for costly pre-funded accounts.
It added that financial institutions and small and medium enterprises or SMEs can now use ODL to leverage previously trapped, pre-funded capital to grow their businesses.
The development may also be significant for remitters, because the Middle East is said to contain two of the world’s three largest remittance corridors, with the UAE and Saudi Arabia handling a combined $78 billion in payments in 2020.
RippleNet’s APAC and MENA Managing Director Brooks Entwistle was quoted by the statement as saying that the MENA region “continues to be a critical region for Ripple thanks to our outstanding roster of customers,” the local regulatory environment, and a regional focus on the improvements in the current financial system.
Meanwhile, Antti Arponen, Co-Founder and CEO of Pyypl, which uses blockchain in its core systems, said it has managed to use ODL to reduce the inefficient use of capital.