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Blockchain in Global Payments: 4 Key Insights

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For payment system users, observing patterns and perspectives is an important part of keeping up with an ever-evolving landscape.

Ripple and the US Faster Payments Council (FPC) collaborated on a second annual 2023 global survey to help payments leaders navigate the ongoing trends and technological advancements in the payments ecosystem. This survey explored current and future adoption of blockchain payment systems to further assess what's happening now and next in the industry.

Over one hundred payments leaders participated in the survey, including a meaningful number of founders, CEOs, and technical leaders. Respondents represent a cross-section of sectors including retail, banking, fintech, and consumer technology throughout North America, South America, Asia, Europe, Africa and beyond.

Read on for four key observations and additional insights on payment usage benefits, adoption plans and barriers to growth.

1. Blockchain in payments unlocks real value

Past surveying proved that leaders were bullish on blockchain and cryptocurrency technology for faster payments, and believed in the potential of blockchain payment processing.

Now, these sentiments have materialized into real value.

77% of respondents note that using blockchain for payments is Very Beneficial or Somewhat Beneficial to their organizations’ end customers. Over 60% suggested the same for customers using cryptocurrency for payments.

Dozens of leaders highlight realized benefits around cost savings, security, settlement speed, and transparency as they relate to payment processing. These benefits extend across both domestic and cross border payment use cases including P2P, C2B, and B2B, as well as within account-to-account transfers, payroll, and disbursements.

Check out a few encouraging blockchain payment statistics:

  • 58% cited more transparency in payment processing

  • 56% cited faster payment resolution and settlement times

  • 55% acknowledged lower cost of international payments

  • 53% found lower cost in domestic payments

Many respondents shared feedback on the blockchain and crypto payments value proposition. Below, we feature some responses that encapsulate survey sentiments:

“[Blockchain will be useful] by driving faster payments between businesses, reducing settlement windows, and ensuring close-to-real time payments for all bookings.”

“[Our first use case] is to facilitate transactions with our core system accounts. Our second use case is to establish a closed loop network between all of our client accounts, most of which reside on external core systems. Lastly, we’ll look at interactions with other closed loop blockchain networks."

"Value moving at the speed of data with potentially near zero cost speaks for itself.”

When asked, “What potential benefits do you think the use of blockchain technology can offer to your organization?” leaders emphasized customer experience and growth.

Over 60% found improved payment experiences for end consumers, while 44% highlighted new competitive advantages – including boosted profit margins on payments and transfers.

Interestingly, technologies are increasingly seen as growth levers, not simply tools for back-office efficiency: 28% of respondents believe that the technologies can grow their customer base, and 26% believe it can increase customer retention. One respondent summarized the opportunity to drive better business outcomes: “We will be able to add more embedded payment use cases and give customers choice."

2. Blockchain payment use cases are wide-ranging, but not of equal interest

We asked leaders about their plans for established use cases including P2P, C2B, disbursements, A2A, B2B, and payroll/wages. And for those currently using or evaluating the technologies, a few go-to avenues for value have emerged.

Domestic payments

With respect to domestic use, organizations show affinity for business-to-business applications.

For those testing crypto domestically, over 40% have B2B applications in mind. For those with crypto payment products already in use, 37% have a B2B use case. (For context: the next most popular use case among those either testing or using crypto is peer-to-peer payments at 20%.)

For respondents who are actively exploring (or who will likely explore within the next year), B2B payments is also the most anticipated use case.

Companies testing or using blockchain (not just crypto) show broader adoption preferences. For these organizations, both P2P and A2A payments are as popular as B2B use cases.

Cross border payments

Respondents show clear appetites for cross border payment use cases that help reduce friction, risk, and costs.

For companies actively exploring, testing, or using blockchains B2B payment use is most popular. However, leaders suggest that P2P payments is a rapidly expanding arena; for those companies already using blockchain, P2P and B2B are equally pursued (26% each, respectively).

Consumer to business (C2B) payments is the least targeted use case for those using or testing blockchain technology. However, for those exploring future use, some C2B interest exists. For those actively exploring, testing, or using crypto, B2B payments is the runaway use case leader. In most cases, B2B payments make up over one-third of all usage.

3. Crypto concerns are (mostly) waning

While participants express blockchain and crypto enthusiasm, concerns do exist.

When asked about barriers in using cryptocurrencies for payments, 64% of participants highlighted a lack of regulatory clarity. The other leading concerns: price volatility (57%) and lack of industry adoption (48%).

Promisingly, 59% of respondents’ organizations allow (or are considering allowing) customers to make payments using cryptocurrencies. Currently, 28% of organizations don’t support this.

For this latter group, concern centers on a key reason: Crypto aversion and low risk tolerance.

One highlight: the market appears to have matured past concerns from the technology’s earliest days. Less than 10% of respondents cite Unclear Benefits, Technical Investment Requirements, or Leadership Buy-In as barriers. Encouragingly, crypto in the United States saw the most legislative progress this year. Despite the spate of legal challenges, clearer crypto asset regulatory frameworks and stance from regulators globally have provided a sense of legitimacy and security - and encouraged more participation.

4. Efficiency and sustainability matter

Sentiment around blockchain technology and sustainability remains strong among payments leaders. This year, 81% of respondents acknowledge the environmental impact associated with blockchain use.

Of these, 60% feel that low energy consumption in the context of blockchain use is very important; while another 18% believe it is somewhat important.

Still, as organizations navigate these concerns around technology and stewardship, more education needs to be done. Just over half (53%) of respondents are familiar with the impact differences between proof-of-work and proof-of-stake protocols, the latter requiring less computational power and energy usage. As well, 20% remain unaware of environmental implications across various blockchains.

The Global Payments Ecosystem is Evolving

Blockchain and digital asset technologies are no longer the shiny new toys. They deliver proven results across varied, compelling use cases for money transfer, faster and more cost-effective payment transactions, and a more future-proofed, transparent payment option compared to traditional payment methods. And as deployments increase, we expect the story of their durability, flexibility, and utility to grow.

While unscrupulous actors and bad press still mar progress, there is global momentum behind payments leaders’ evaluation and deployment work. In part, because an ecosystem of technology, service providers, and crypto-native consumers are in place. From trade finance and wholesale distribution, to a financial institution or IT Services company making B2B cross border payments to vendors and suppliers - the current payment system is not fit for purpose. Blockchain payment systems provide a promising path forward for cross border transactions.

As companies consider strategies, all roads lead back to one question: If not now, when?

Visit the US Faster Payments Council or contact Ripple today to learn more about blockchain payment solutions.

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