Wallis clarifies that financial inclusion aims to extend financial services to individuals worldwide, especially those with low incomes and no ties to financial institutions.
James Wallis, Ripple’s vice president for central bank digital currencies (CBDC) Engagements, has highlighted the role of CBDCs in advancing global financial inclusion in a brief video. Wallis clarifies that financial inclusion aims to extend financial services to individuals worldwide, especially those with low incomes and no ties to financial institutions.
Wallis pinpointed key factors behind financial exclusion, which include, low incomes and a lack of existing ties with financial institutions, leading to the absence of a credit history. In regions with financial exclusion, banks are often commercial entities driven by shareholder interests, posing challenges in serving individuals with limited resources as generating profits from such a demographic is difficult.
Wallis contended that CBDCs provide a cost-effective solution by enabling financial services at a significantly lower cost than traditional methods. CBDCs offer streamlined payment options and chances to establish credit, even without previous ties to financial institutions.
This, in effect, enables individuals to build credit histories, acquire borrowing capabilities, and stimulate the growth of their businesses. Wallis concluded that CBDCs represent a transformative innovation addressing global challenges in financial inclusion.
Ripple is working in partnership with more than 20 central banks globally on CBDC initiatives and has taken on the role of the technology partner for the second phase of the CBDC project in the Republic of Georgia. Additionally, Ripple is actively engaged in CBDC collaborations in Bhutan, Palau, Montenegro, Colombia, and Hong Kong.
Ripple is currently engaged in a legal battle against the SEC. In July, Ripple received recognition from Currency Research for its contributions to digital currency advancement and best sustainability initiative, particularly for fostering innovation in CBDCs. Before the partnership with the NBG for the digital lari project, Ripple had proactively aligned itself with organizations seeking to delve into CBDC implementations.