Ripple announced today that it has launched a new beta service dubbed Line of Credit that is available to RippleNet customers who can now use the network’s on-demand liquidity (ODL) service to source capital and initiate payments using the network’s token XRP.
This would mean that Ripple’s Line of Credit would provide upfront access to capital for markets. The firm claimed that through this new credit arrangement, Ripple aimed to “simplify” access to financial solutions that accelerate business performance and scale.
Line of Credit feature is the latest development after the Chief Executive Office of Ripple Labs, Brad Garlinghouse announced the appointment of its RippleNet General Manager, Asheesh Birla, to expand on RippleNet’s On-Demand Liquidity (ODL) service that allows customers to reduce the need to pre-fund accounts.
RippleNet GM reasoned that this new credit feature was a response to the firm’s customers who claimed that access to capital was “the biggest barrier to growth.” He added that RippleNet aimed this feature at startups, SMEs and e-commerce companies that “lacked the resources” to scale. He said in a tweet.
We’re providing customers with financial solutions that were once only available through legacy systems – now without the cost and overhead. This is the first of many more to come.
According to the firm, RippleNet customers who use the ODL service, can purchase XRP from Ripple on credit, and will be charged “one fee” on the amount borrowed. Line of Credit has already been in use by RippleNet customers, who specialize in cross-border money transfers. The firm added:
RippleNet customers simply take advantage of one simple XRP-based arrangement everywhere that ODL is available, regardless of sending destination or fiat currency and costs a lot less than most other available credit options.