• Through Ripple Payments Direct, retail users can initiate a cheap and instant payment to the beneficiary through Ripple’s infrastructure, replacing the need for a bank.
• In cross-border payments, Ripple uses payout partners and clearing rails through RippleNet to deliver the fastest global payments.

For years, Ripple has been striking partnerships with financial institutions to onboard them onto its XRP-powered payment systems. These have included money transfer institutions like MoneyGram, global banks like Spain’s Santander, and payment solutions providers like Britain’s Clear Junction. But what if Ripple eliminated all these middlemen and embarked on a path toward becoming the primary financial services provider?

As one XRP ecosystem member noted on X, the company already has a blueprint for becoming its own bank, in the way of Ripple Payments Direct.

According to its website, Ripple Payments Direct (RPD) allows users to connect to Ripple “as a payment provider.”

It further explains: “By using Ripple Payments Direct, you have a direct financial arrangement with Ripple for cross-border fiat payment services. Ripple takes care of delivering payments to beneficiaries, managing payout partners, providing funds to payout partners, and paying charges in exchange for payment delivery to the beneficiaries. ”

Additionally, RPD eliminates the need for users to buy, sell, or custody XRP, eliminating barriers to entry for crypto skeptics.

How Does Ripple Payments Direct Work?

Essentially, RPD has three components: the originator, Ripple, and the beneficiary, as shown below.

The originator is any user who seeks to send money on a fast, cheap, and efficient network. This originator feeds the payment instructions to the network through the Ripple Payments UI, which has been optimized to be intuitive, allowing even non-crypto users to access it.

Once the payment is initiated, the network shows the originator all the key events and state changes as it travels across the different lifecycles. After it gets to the beneficiary, RPD adds the payment transaction to the originator’s invoice.

RPD has some notable features that make it a worthy choice. The first is that the user doesn’t have to have any prior knowledge about crypto; in fact, the user doesn’t even get to know that they are relying on blockchain or crypto.

Another feature is that Ripple has partnered with several payout partners to guarantee last-mile payment delivery on optimized payment paths to reach the beneficiary. It has also built the solution to be compliant with every local and national regulation in every jurisdiction in which it operates. What’s more, if the transaction fails on the first try, RPD has an automatic auto-retry feature.

RPD is already in use globally, with payroll being among the top use cases. Once an employer initiates a payment to employees or contractors and deposits the funds in his local currency, RPD converts the funds into the recipient’s currency of choice.

Liquidity management for local and international subsidiaries and payments to vendors and suppliers have also emerged as strong use cases.

Meanwhile, XRP trades at $0.5799, gaining 1% in the past day. The boost from the SEC ruling seems to be wearing off as the token trails peers like Bitcoin and Ethereum, which gained over 4% each in the past day as the market recovered.

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