Payments innovator Ripple to open in Sydney

Digital payments upstart Ripple is setting up its Asia Pacific subsidiary in Sydney under the leadership of Dilip Rao, and is now looking for specialist programmers and analysts to work with companies in the region to develop straight-through real-time settlement systems.

Ripple is a trust-based settlement system hinged around an online payment ledger. Organisations can transfer digital currency known as Ripples (XRPs) or represent fiat currencies as debt on the ledger, with payments then concluded, where required, using domestic settlement systems.

Rao said that setting up a two-way Ripple ledger was relatively trivial, but Ripple technologists would support banks and other users with the integration of Ripple into their existing back office systems.

While Ripple has attracted a good deal of attention for its attempts to harness the internet to strip friction out of the payments process, concerns have been raised over the privacy and security of the process and the overarching reliance on trust between participants.

There are 100 billion XRPs on issue with no plans to issue more. XRPs can however be divided into smaller payment units.
 
Ripple is currently based on open source software, with the company relying on the services it offers to actually make any money.

Rao, who has been appointed managing director of Ripple Labs Asia Pacific, said that in the future XRPs could be a potential source of income if the virtual funds became used as a currency of convenience to create liquidity in the market.

Ripple now wants to work with financial institutions and businesses to build settlement systems and grow demand for Ripple.

Rao said: "If all the banks in Australia and the Reserve Bank plugged into Ripple they could be settling in real time."
 
That, however, is precisely the intent of the New Payments Platform now being constructed by SWIFT to allow real time settlement across Australia, which will likely prove a significant competitive hurdle for Ripple - at least for domestic payments.