Commonwealth Bank of Australia (CBA) has become the next financial institution to adopt the Ripple protocol for currency transfers.
CBA is one of Australia’s “big four” banks and is the second largest company listed on the Australian Securities Exchange (ASX) after mining giant BHP Billiton.
CIO David Whiteing made the announcement at an event hosted by the Australian Information Industry Association (AIIA), saying CBA will use the technology to make transfers between subsidiaries.
He pointed to a payments infrastructure that has apparently failed to keep up with technology, saying, “If you look at payments protocols today, they are 40 years old, so they are very old technology that are highly susceptible to being compromised.”
He was also not shy about his openness to actively engaging with cryptocurrency, adding:
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“Bitcoin is a protocol which is now being replicated by non-asset based vendors like Ripple and others. We absolutely see that’s where it’s going to go. The bank has a role to play in that.”
He indicated that cryptocurrency can function not just as a means to serve fiat with its technology, but even as a currency in its own right. He took it a step further, even suggesting that the bank’s accounts should be capable of holding cryptocurrencies and playing a role in the crypto ecosystem:
“You have multicurrency bank accounts today with the Commonwealth Bank’s app, 15 currencies available on your phone instantly in real time. It’s not that difficult for us to take that technology and make that a loyalty points store. It shouldn’t be that difficult for us to then add cryptocurrencies to it and whatever other means of payment transfers people might want.”
Whiteing went on explain the importance of mobile banking and payments, particularly in underbanked countries. He also touched upon his vision for a streamlining of payments platforms, where fewer systems are used and operations become more efficient.
CBA joins Germany-based Fidor and two small US-based banks, as well as global bank payments network Earthport, in adopting the Ripple protocol for payments.