Payments platform Ripple inks deal with Accenture

22 October 2015 Consultancy.uk

Accenture has struck an alliance with Ripple, an enterprise company providing cross-currency settlement solutions for financial institutions. Through the use of the firm’s low overhead and fast ledger systems, banks can, according to the firm, considerably decrease their costs in the payment domain while increasing oversight and transaction reliability. As part of the deal, Accenture will integrate Ripple’s products in its advisory services to clients.

The traditional clearing house may be a thing of the past as distributed financial technologies become more and more accepted within the formal banking system. The distributed ledger system has a number of advantages to offer over traditional ledgers. They for instance do not need a central authority to certify and clear transactions and the system is more resistant to fraud, as each transaction ledger is verified by a community of networked users. The peer-to-peer based transactions network as a result requires considerably less supervision, bringing down associated costs. Further, the historical records created through the system are publicly accessible, enabling for effective monitoring and auditing by participants, supervisors and regulators. Moreover, end-to-end visibility across transactions is granted, providing banks for the first time in the industry certainty when a payment will be delivered. 

Ripple

The rise of distributed transaction systems saw the story of Bitcoin make international headlines on what became a roller coaster ride for Bitcoin owners as they gained and fell dramatically in value. Another less advertised form of distributed ledger has been developed by Ripple. The company, founded in 2012, developed Ripple, a distributed financial technology enabling instant cross-currency settlement and competitive FX market making. Ripple allows for direct, real-time settlement between financial institutions, offering an alternative to the complexities of today's correspondent banking system. While Ripple does offer a digital asset, XRP, the banks experimenting with and implementing Ripple to date have opted to use the technology to move fiat currencies across borders.

Ripple has garnered considerable attention from the financial services sector in recent years, having so far secured $38 million in Seed and Round A funding. It most recently announced plans to introduce further payment technology options for banks, titled Interledger – which offers improved privacy and scalability. The company is also introducing enterprise software solutions for cross-currency settlement and foreign exchange market-making.

The partnership with Accenture will see the consultancy offer Ripple’s products to its clients within the financial services industry looking for payments options. The firm has seen a rise in demand for blockchain-based products, Accenture’s Managing Director for connected commerce, Tim Summers, saying: “The opportunities here are significant, I think, when it comes to streamlining business. There’s this opportunity to grow existing markets, go after new markets, and create new products.”

Tim Summers, Managing Director at Accenture Digital

Earlier this month, Chris Larsen, CEO and co-founder of Ripple, unveiled the firm had attracted a $4 million investment from Santander InnoVentures, the bank’s venture-capital arm led by former McKinsey & Company Associate Principal Mariano Belinky. “Santander InnoVentures is a natural fit in this round because of their demonstrated support for real-time international payments and their commitment to new technologies that enable Santader to empower its customers,” said Larsen.

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