A collective source from the World Bank has stated that around 1.4 billion adults across the globe were still unbanked. Every individual who is underbanked might lack access to basic financial services like savings accounts, secure money transferring, and loaning. The main reason behind it is many people are living in remote areas while some live in underserved regions where they face barriers like limited banking infrastructure, lack of documentation, high fees, or distrust in traditional banking methods, and more. How to get rid of this scenario in this digital era? This is where XRP comes into action. In recent days, the rise of blockchain-based payment solutions like XRP has been creating new possibilities for global financial inclusion.
Why XRP?
XRP - the native token of Ripple, operates on XRP Ledger, offers speedy, cost-effective, and energy efficient cross-border payments. These are the key factors making XRp an ideal blockchain solution for reaching unbanked populations, and provide them access to experience fast, affordable, and secure financial services digitally across the world. Staying updated on XRP price prediction models and methods can help investors make smarter & more strategic decisions.
How XRP Helps Unbanked Populations?
Affordable Cross-Border Remittances
One of the biggest financial challenges for migrant workers or people who live in remote areas face is remittances ( money sent home by migrant workers). The traditional remittance services are often quite slower in process and charge high transaction fees. That is it may charge 5% to 10% of the money sent as transaction fees and might take days to settle the payment.
As XRP is mainly focused to provide near-instant and cost-effective cross-border payments, remittance services through XRP can be more affordable. This is because XRP charges only a fraction of a cent as its transaction charge. Hence, with RippleNet's On-Demand Liquidity ODL, remittance providers can convert their local fiat into XRP, sent across borders, and convert it back to recipient's native currency within 3 to 5 seconds.
How XRP Benefits?
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Reduces cost for both sender and receiver
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Enhance access to remittances in rural areas
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Eliminate the need for pre-funded accounts and banking intermediaries
Mobile Wallet Integration
In many developing countries, mobile phones are the major accessible source than bank branches. Many FinTech companies are adopting XRP into Mobile wallets.
How XRP benefits?
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Send and receive money directly from mobile phones
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Store value securely without any bank account
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Convert XRP into local currency at partner exchange points
To access these wallets, unbanked individuals should have a smartphone with good internet connection. This lowers the barrier and lets the unbanked individuals enter the world of finance.
Financial Identity and Inclusion
As mentioned earlier, lack of identity documentation is another hurdle that leads several individuals to end up unbanked. Though XRP is not a solution for identity decentralized applications that are built on the XRP Ledger can facilitate self-sovereign identity systems. It allows unbanked populations to access financial services without traditional paperworks.
How XRP Benefits?
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Verify themselves for financial transactions
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Build a credit history based on digital activity
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Access lending, insurance, and savings platforms
End to End Financial Services
Even in developed countries, some areas don't have reliable banking infrastructure. But with XRP, individuals can transfer value to friends, family, or merchants without involving intermediary.
How XRP Benefits?
Final Words
To connect the unbanked population to access digital finance service could be a challenging task. But with XRP, unbanked people can break down the key barriers to access financial services across borders. As XRP provides speedy and affordable transactions, it has achieved global reach, making it an ideal solution for delivering inclusive financial services. From Remittances to end-to-end payments, XRP is proving to be more than just a digital asset. As a positive scope, it offers hope for a more equitable and connected global economy.
michael lrobert