$55 million was raised in funding rounds by Ripple, a Google-backed start-up that uses blockchain technology to settle financial transactions between some of the world's biggest banks.
Standard Chartered, Accenture Ventures, SCB Digital Ventures, the venture arm of Siam Commercial Bank, and Japan's SBI Holdings were involved in the latest finance round. Santander Innoventures, the venture units of CME Group and Seagate Technology, and Venture 51 were the additional investors.
With its existing base of investors which include GV, Google's venture arm, Andressen Horowitz, IDG Capital Partners, and AME Cloud Ventures, the latest funding round has brought some large strategic corporate partners onboard.
The company has raised over $93 million in total funding to date.
Banks looking to make cross-border payments more efficient are the focus of Ripple to provide this technology.
A few days might be taken at a very high cost for an international payment at the moment. Its technology can allow lenders to move money "in seconds" and could give banks a 33 percent reduction in their operating costs during this process, Ripple said.
High-volume, but low-value, transactions - the kind that Facebook might pay out to app makers for example is the present headaches for banks. Since these transactions takes a lot of effort to move the money and the percentage cut won't be as high as for a larger transaction, these can often be expensive and not profitable for the banks. It can potentially make these transactions profitable, claims Ripple.
Including UBS and Santander, the start-up is currently working with 15 of the top 50 global banks.
The company was investing the fresh funds in global expansion, said Chris Larsen, the chief executive of Ripple.
"We have been expanding our office locations. We want to continue that and grow those teams, we want to be hiring so we can have engineers on the ground with local banking partners as you have to get in there with the banks to make sure you have a complete solution and make things as easy as possible," Larsen told CNBC in a phone interview.
The company is considering Singapore and Frankfurt as the next locations after it recently opened an office in Luxemburg.
Recording every transaction and storing this information on a global network so it cannot be tampered with, Blockchain - which is the basis for Ripple's technology - works like a huge, decentralized ledger for the digital currency bitcoin. In areas from remittances to securities exchanges, banks feel that this technology can be utilized.
Micropayments could rise in the future as an increasing number of devices come online in the so-called "Internet of Things", Larsen said. This is where Ripple could take advantage.
"With a connected device a hundredth of a penny might need to be sent, that can't happen today. But we are working to make that happen and it opens up a new field of services and revenue for the banks," Larsen said.
On many parts of a bank's business, blockchain could have a cost-cutting impact, experts said.
"In areas such as transaction settlement, the introduction of a blockchain-based system would substantially reduce both the risk of error and the time taken for error checking", a report from analyst firm Juniper Research claimed while sounding caution that the technology needs to be secure.
"While blockchain technology offers the potential for increased speed, transparency and security across an array of verticals, there has to be rigorous and robust roadtesting in each unique use case before any decision is taken," Windsor Holden, analyst at Juniper Research, wrote in a report last month.
(Source:www.cnbc.com)
Standard Chartered, Accenture Ventures, SCB Digital Ventures, the venture arm of Siam Commercial Bank, and Japan's SBI Holdings were involved in the latest finance round. Santander Innoventures, the venture units of CME Group and Seagate Technology, and Venture 51 were the additional investors.
With its existing base of investors which include GV, Google's venture arm, Andressen Horowitz, IDG Capital Partners, and AME Cloud Ventures, the latest funding round has brought some large strategic corporate partners onboard.
The company has raised over $93 million in total funding to date.
Banks looking to make cross-border payments more efficient are the focus of Ripple to provide this technology.
A few days might be taken at a very high cost for an international payment at the moment. Its technology can allow lenders to move money "in seconds" and could give banks a 33 percent reduction in their operating costs during this process, Ripple said.
High-volume, but low-value, transactions - the kind that Facebook might pay out to app makers for example is the present headaches for banks. Since these transactions takes a lot of effort to move the money and the percentage cut won't be as high as for a larger transaction, these can often be expensive and not profitable for the banks. It can potentially make these transactions profitable, claims Ripple.
Including UBS and Santander, the start-up is currently working with 15 of the top 50 global banks.
The company was investing the fresh funds in global expansion, said Chris Larsen, the chief executive of Ripple.
"We have been expanding our office locations. We want to continue that and grow those teams, we want to be hiring so we can have engineers on the ground with local banking partners as you have to get in there with the banks to make sure you have a complete solution and make things as easy as possible," Larsen told CNBC in a phone interview.
The company is considering Singapore and Frankfurt as the next locations after it recently opened an office in Luxemburg.
Recording every transaction and storing this information on a global network so it cannot be tampered with, Blockchain - which is the basis for Ripple's technology - works like a huge, decentralized ledger for the digital currency bitcoin. In areas from remittances to securities exchanges, banks feel that this technology can be utilized.
Micropayments could rise in the future as an increasing number of devices come online in the so-called "Internet of Things", Larsen said. This is where Ripple could take advantage.
"With a connected device a hundredth of a penny might need to be sent, that can't happen today. But we are working to make that happen and it opens up a new field of services and revenue for the banks," Larsen said.
On many parts of a bank's business, blockchain could have a cost-cutting impact, experts said.
"In areas such as transaction settlement, the introduction of a blockchain-based system would substantially reduce both the risk of error and the time taken for error checking", a report from analyst firm Juniper Research claimed while sounding caution that the technology needs to be secure.
"While blockchain technology offers the potential for increased speed, transparency and security across an array of verticals, there has to be rigorous and robust roadtesting in each unique use case before any decision is taken," Windsor Holden, analyst at Juniper Research, wrote in a report last month.
(Source:www.cnbc.com)
