The fifth-largest bank in the ASEAN region, the CIMB Group, has entered a strategic collaboration with American blockchain company Ripple. The two will work together to enable instant cross-border payments in all CIMB’s markets. The bank will join RippleNet, a network of over 100 financial institutions around the globe, which will help in redefining the global payments business of CIMB.
Rising Ripple Footprint in ASEAN
Ripple’s Singapore headquarters are doing a great job in keeping the company well planted in the region. CIMB is one of the first banks in the region to leverage blockchain technology for making low cost and quick international payments. The ASEAN region has historically been plagued with inefficient and slow payment systems, which provides a great opportunity for Ripple’s solutions to shine.
According to the World Bank, the remittances to Southeast Asia will grow to a whopping $120 billion, a sizeable chunk in contrast to other geographic regions. Data from The Boston Consulting Group (BCG) suggests that the size of the cross-border payments market is $27 trillion. Between 2018-2026, another $20 trillion could be added to the valuation of these markets. About 39 percent of this market will be concentrated in ASEAN.
Enhancing CIMB Products
CIMB already works on a proprietary remittance product SpeedSend, which will be enhanced using the blockchain solutions from Ripple. The service allows customers to utilize instant cash collection and direct account crediting facilities. SpeedSend is enabling remittances to Australia, UK, US, and Hong Kong corridors.
The CEO of CIMB Group, Tengku Dato’ Sri Zafrul Aziz said that the bank is delighted to connect to the RippleNet. He said:
“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.”
The Ripple solution will be extended to other use cases within the Group as well. Ripple CEO Brad Garlinghouse commented that financial institutions are becoming increasingly interested in using blockchain-based technologies for their businesses as they allow quicker, low cost and more transparent solutions.
He noted that with its presence in 15 countries and about 800 branches, CIMB’s SpeedSend solution would help customers “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.”