The UK arm of Spanish banking group Santander has developed a new app using blockchain in partnership with distributed ledger start-up Ripple, which aims to make international payments for customers faster and cheaper.
The app is currently available to Santander UK staff and the bank plans to roll it out nationwide later this year in a bid to become first major bank in the country to offer payment services via blockchain to its clients.
“The need for finance has evolved from providing a physical pound in your pocket or card in your purse, where you pay at a till, to being seamlessly integrated into a new, always on, connected lifestyle,” said Sigga Sigurdardottir, chief customer and innovation officer for Santander UK.
Users can send sums from £10 (US$15) up to £10,000 and transfers into euros and dollars. The app utilises the Apple Pay mobile payments app as an interface, leveraging Ripple’s distributed ledger as the payment rail and settles the funds in accounts the next day. It currently provides transfers between Santander locations in 21 European countries and also the US.
Ed Metzger, Santander UK’s head of innovation, technology and operations, told the Financial Times: “Clearly, it’s an area where, as an industry, we don’t have as good a customer experience as we could do … there are a lot of pain points.
He added that there was currently much activity in international payments and the new digital players had been able to make inroads in the market because “customer experience through normal channels isn’t great”.
The partnership with US-based fintech Ripple follows last year’s US$4m investment in the firm by the bank’s venture capital arm, Santander InnoVentures. Metzger told the FT that as more banks joined the Ripple network, its ability to facilitate payments overseas instantaneously would grow.
At last month’s Money 20/20 event in Copenhagen, Santander announced that it was piloting a tool with online lender Kabbage to give UK small and medium sized enterprises (SMEs) access to same day funding.
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