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Everyone probably heard the news that Ripple announced the launch of the PayID fast transfer service, but most people took this news as “another one”. Let’s try to figure out what this means and why this is a “silent” revolution in the payment system.
Imagine that your friend who lives in Spain reported that he was in a difficult situation because he forgot to top up his phone balance when he went hiking in the mountains. He needs you to transfer $5 to his phone so he can get directions on Google Maps to get home.
And you yourself are, say, in Zhytomyr. How long will it take you to find a solution to the problem? And, if you find one, how much will you pay on top of that $5 to help a friend? We believe that most people will face the question: how to do this? And it will be easier for a friend to master star navigation.
Many of us use e-wallets. Have you ever wondered what functionality they represent? For example, the Qiwi interface.
You can transfer money from Qiwi to Qiwi, to a bank card (for a decent percentage), pay for mobile communications, internet, etc. However, each such point has a limited number of supported structures and organizations. Why? Because with each of them Qiwi must be negotiated individually.
Ripple asked the same question: “Why is it not a problem to send a photo of five dollars in our digital world as an attached message to a friend, but transferring the same $5 is still problematic?”
The modern financial system consists of hundreds of different organizations (banks, “fast” transfer systems …), each of them consists of its own isolated networks, and the interaction between them is carried out using the anachronistic SWIFT (founded in 1973). It’s like writing an SMS: “How are you?” and pay another $2-3 for it. How often would you use the instant messaging service?
Are you familiar with the situation when you come to reissue a lost bank card at the nearest bank office, and you are sent to the other end of the city, because you once lived there and issued a card in another office. And this is an innovative bank in the 21st century!
So what does Ripple offer?
The picture from the PayID site itself is best illustrated and it doesn’t matter that you have Mastercard, Visa, PayPal, Qiwi, Bitcoin, ETH … all this will be connected together with PayID. And if your friend, who got lost in the mountains of Spain, also has a PayID, then you can easily send him $ 5 along with your photo and who knows what else will come faster.
The transaction speed will be provided by RippleNet.
As for the cost of the token, which will provide the transfer of value, it is absolutely indifferent to the sender and recipient, but, naturally, the more users, the more liquidity will need to be provided.
Why this service will conquer the market very quickly? Well, firstly, this network is open, and any organization, if desired, can connect to it. To date, it already covers about 100 million people.
Here is a list of supporting organizations:
Now think about why the same Ripple-promoting, Japanese banking consortium SBI invested in Qiwi, Money Tap (which has now won a tender to service retail QR payments)? Why did Ripple invest in MoneyGram, a direct competitor to Western Union? There have been a lot of such partnership agreements and investments lately. Guessed?
Suppose that you now have Yandex money installed on your smartphone to transfer funds to Yandex wallets, Qiwi – for transfers to Qiwi, PayPal – for purchases on eBay, WebMoney … And imagine that a system will appear that can do all this alone and even more, and even for a meager commission, and instantly. Would you use 3-10 services if one gave you everything and more, and faster, and for less money?
Another untapped niche is acquiring
Anyone who has experienced acquiring probably already knows how much it costs. Here, for example, is the cost of servicing acquiring at Sberbank for a small shop with a turnover of 1 million per month.
Acquiring is more than 2%. This is fine? Why? Because of this payment scheme in the acquiring network.
The most interesting thing is that in all countries of the world acquiring is much cheaper and for a reason.
Each entrepreneur, entering into a contract for servicing non-cash payments with various banks (VTB, Sberbank …), only nominally signs agreements with them, but, in fact, all these banks are exclusively serviced by UCS (United Card Services). This company is registered in Russia, but its founder, Global Payments, has the jurisdiction of the United States, Atlanta (in the same place, by the way, as the Central Bank of the Russian Federation).
Simply put, every time you pay with a card for bread at the bakery, you service the external debt generated by the US Federal Reserve – this is one of the many schemes for exporting inflation.
And, by the way, who services the acquiring of Mir cards, to which state employees were massively transferred, presenting all this as our response to sanctions? That’s right – UCS, and payments – the same SWIFT. A bold and painful decision for the US, don’t you think?
So let’s get back to our topic and think about what the entrepreneur will say when he is offered PayID? It is likely that he himself will persuade buyers to pay through this service, and the intermediary services of banks will remain unclaimed.
How will banks react to this? It does not matter, because the system is open and it does not have the goal of destroying someone and giving an advantage to someone. If you want to survive – join. It is only obvious that this service is in the new paradigm that is currently being inculcated in the world, at least no angry shouts from the SEC, the Ministry of Finance … are heard, despite the fact that the legal address of the backbone organization PayID is the United States. Let’s see how many more “waves” of COVID-19 we need and how deep it will take to drive the world economy, saving it with endless emissions. But one thing is certain, the end justifies the means: each person has an ID, and each ID has a PayID!
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