Ramp, a US-based corporate card and financial operations platform, announced the expansion of its partnership with financial services company Stripe to launch the “industry’s first stablecoin-backed corporate cards with fully integrated spend management software.”
According to the press release, the two companies aim to make cross-border transactions easier and faster compared to the solutions businesses have had so far.
They highlight four major issues businesses are facing at the moment. The first is the time: payments typically take at least five business days to settle. Next is the high cost: a transaction can be $50 or more in fees.
Additionally, there’s the issue of fiat volatility. Local currencies can swiftly lose significant value, creating financial risks for global entities. And finally, there’s the problem of the complexity when issuing corporate card. Per the announcement, “cumbersome country-specific regulations and payment rail variations [cause] delays and frustration.”
Subham Agarwal, Director of Product and Head of Product Marketing at Ramp, commented that the card the company is developing with Stripe improves the way businesses spend globally. It also empowers “our customers everywhere with a radically simpler and more stable way to transact across borders.”
Meanwhile, as recently reported, Standard Chartered Bank recently predicted that the stablecoin market could go up by about 10-fold to $2 trillion within the next three years. Citigroup projected that the market cap could surpass $2 trillion by 2030.
‘Built-In Protection From Local Currency Volatility’
Per the announcement, the companies have worked to combine Stripe’s stablecoin-backed cards and Ramp’s financial platform to boost business growth and commerce. This is particularly the case for the regions where this approach is the most necessary, they add.
Therefore, the card is a solution for the above mentioned pain points. The companies claim that it provides fast settlements, lower fees, offering businesses dramatically faster settlements, lower costs, built-in protection from currency volatility, and easy card issuance.
Moreover, businesses can fund a wallet using local currency to convert it to stablecoins, or they can deposit stablecoins.
On the other hand, cardholders will pay in their local fiat currency, which the merchant will receive as well.
Additionally, when it comes to the above-mentioned built-in protection from currency volatility, the companies explain that funds are held in dollar-equivalent value to protect against devaluation.
Moreover, the new card is available in several countries, starting with certain Latin American markets. “The focus on Latin America aims to address the growing demand for businesses to utilize stablecoins to store value and fund purchases.”
The partners will expand availability to Europe, Africa, and Asia, they say.
Meanwhile, Ramp was founded in 2019. It says that it has over 30,000 customers across industries who have saved $2 billion and 20 million hours by utilizing its services, as it enables “tens of billions” in purchases annually.
Stripe recently introduced a new financial tool called Stablecoin Financial Accounts. It enables companies in 101 countries to hold and transact in stablecoins, allows businesses to receive funds via both crypto and fiat rails, hold balances in digital dollars, and send stablecoins globally.
It followed Stripe’s $1.1 billion acquisition of the stablecoin infrastructure firm Bridge.
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