• Countries that receive sizeable amounts of payments make for excellent last-mile corridors
• Blockchain and new technologies allow for fast and error-free services in payments
• Educating and collaborating with regulators are crucial

Self-described blockchain enthusiast Navin Gupta serves as Ripple’s managing director for South Asia and the Middle East and North Africa regions for remittance network. He has nearly two decades of experience in the global payments industry, having worked for HSBC and Citigroup in the past. 

In this interview, Navin talks about the Ripple network, the importance of working closely with regulators, technology, and the reason emerging markets provide good opportunities for the payments industry.

Siddharth Chandani (SC): We are speaking to Navin Gupta, who is the managing director for South Asia and MENA at Ripple. Ripple’s vision is seeing data, goods and money flow seamlessly across the whole world, wherever their ecosystems are. Share your journey in terms of your current customers, potential segment of plans that you want to see and enable, including expansion plans.

Navin Gupta (NG): Ripple’s mission is to move money like information moves today. The way we work is we work in a corridor structure. For example, the reason I run both MENA and South Asia is that MENA is the originating region where hundreds and thousands of immigrants from South Asia work and send money back to their families. What we want to do is bring in originating institutions and receiving institutions to our network so that the customer experience is complete. For example, when Siddharth from the United Arab Emirates (UAE) sends money back to his family in India, it’s instant, low-cost, and error-free. We are able to deliver the customer experience that Ripple enables its institutions to deliver.

SC: As of 2018, you have more than 200 customers spread across 40 countries and you’re seeing roughly two financial institutions sign up on Ripple per week. India continues to be a big market. What other corridors are you looking at and how are you growing your client base in those corridors? 

NG: Emerging markets tend to be our focus. As you know, 50% of our clients are based out of Middle East and Asia. If you look at the Philippines and Thailand, countries which are large receiving corridors tend to be the markets where we build our distribution network’s last-mile connectivity. That means the money that had been remitted – for example, from Japan – it may end up in bank accounts, wallets, or cash networks, like in the Philippines. 

What we want to do is we want to give our customers the choice so that they can choose the best distribution point which they're comfortable with, because all these countries have big rural, semi-urban and urban populations. That same choice is what we want to create in our originating side as well. A lot of our customers tend to be banks, fintechs and payment service providers (PSPs). A lot of times, there also tends to be new telcos getting into the remittance space. But in both sides, they are licensed institutions that are using Ripple to help remittances for different use cases. 

SC: The Reserve Bank of India (RBI) has demonstrated a proactive stance in blockchain transactions. But at the same time, the late former finance minister [Arun Jaitley] voiced his displeasure as he does not consider blockchain as a legal tender and they may even launch a crackdown. Share some success stories with your clients amidst this.

NG: I would just like to clarify to make sure, because a lot of times, we confuse blockchain and digital assets together. Blockchain as a technology is far more fundamental. It's almost like internet, with an email being the use case. A digital asset is one use case that's built on blockchain. 

Blockchain is perfectly legal in most places without any use of digital assets. For example, all of our customers who send money into India don't use any digital asset, but they are able to speed up and have error-free service from different currencies itself. So, that means there could be clients in the United Kingdom who are sending in British pound, clients in the Middle East who are sending in UAE dirham or Saudi riyal and the beneficiary receives money in Indian rupees without the use of any digital asset. Today, we are enabling that, at this time, across the world for Indian companies and giving Indian banks the choices of multiple distribution options and similarly, multiple sending options on the left side as well. 

We have not introduced on-demand liquidity which uses digital assets in India. Until the enabling provisions from the regulators are there, we won't put that into the market. But we are live in the Philippines, because the [Philippine] central bank allows digital exchanges to be the pay-out corridors of remittances. Hence, we are live there, but we are not live in India.

SC: Speaking of regulators, since your growth focuses particularly in the emerging markets segment, and they're seeing significant volumes in cross-border remittances, what are some of the challenges in terms of trust issues you face when dealing with regulators? 

NG: I'll be very upfront with you: there's no training school for regulators. Today, if there’s new technology, ecosystem or framework coming in, how do you educate the regulator? Where would the regulator go to learn fundamental ideas about the technology or the change that is happening? So, the first thing that we do is work with regulators to remove myths from reality, remove speculation from what is really happening, and not to get influenced by just the newspaper or the media, which tend to be far more speculative in nature. We [tell them] what's the underlying technology, the benefits, the risks – the discussion is about the technology. Even with Ripple, we essentially say, ‘first, get comfortable with it’ [for them] to see how it can help the citizens of their country. 

Once the regulator is educated, they understand what benefits it brings to the masses. Then, we work with them to have an enabling framework for the technology to be adopted in different countries. We work very closely with central banks in Ireland, the Philippines, Mexico – somehow, we have close collaboration with them – and again, we follow that up. [First] is education, awareness, working closely with them, and then – depending on their comfort level – putting the enabling provision in place working with licensed financial institutions in their country to bring the technology there. 

SC: You're also working with payment banks launched by telcos and fintechs. How do you plan to leverage their distribution network?

NG: The great thing about the payments banks is that they provide a great last-mile connectivity. That's the purpose of RBI giving the licences in the first place, to make sure that they are able to bring in financial inclusion. We are working closely with a number of them to make sure that when the remittance comes into India, the last mile can be delivered through a payments bank outlet. This could be in the form of bank accounts, wallets, or cash. Some of the families, whether we like it or not, need to have cash for their day-to-day needs and then they are able to go and withdraw from a distribution partner point that is much closer to them versus the bank branch.

SC: The house remains divided in this case. You’re gaining traction but the uptake of SWIFT gpi’s services is tremendous. In fact, the total figure is 70% of almost $40 billion of transactions. Do you see SWIFT as a competitor? 

NG: I think it is very, very simple. At the end of the day, the customer is the king. The Ripple network is growing. The reason financial institutions are making the choice of Ripple is because they see something that is not available in the market today. They see a leap in the customer experience [compared to] what is being delivered today. I don't want to comment on some of the other institutions, the choices that they're making or how other networks are growing, but we are growing extremely fast. Every day, new customers are making the choice that they want to go with Ripple, they want to open new corridors, they want to push more volume through us. For us, that's a win. We stay focused on the customer; we are not looking left or right. Until we keep delivering value to the customer, Ripple will keep growing.

SC: Thank you.

NG: Awesome. Thank you.