Ripple, a Google-backed start-up that uses blockchain technology to settle financial transactions between some of the world's biggest banks, has raised $55 million. The latest finance round involves Standard Chartered, Accenture Ventures, SCB Digital Ventures, the venture arm of Siam Commercial Bank, and Japan's SBI Holdings. Additional investors include Santander Innoventures, the venture units of CME Group and Seagate Technology, and Venture 51. The latest funding round has brought some large strategic corporate partners onboard with its existing base of investors which include GV, Google's venture arm, Andressen Horowitz, IDG Capital Partners, and AME Cloud Ventures. To date, the company has raised over $93 million in total funding. Ripple's focus is on providing this technology to banks looking to make cross-border payments more efficient. At the moment, an international payment may take a few days to make with a very high cost. Ripple said that its technology could give banks a 33 percent reduction in their operating costs during this process and allow lenders to move money "in seconds".



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A headache for banks is high-volume, but low-value, transactions - the kind that Facebook might pay out to app makers for example. These can often be expensive and not profitable for the banks because it takes a lot of effort to move the money and the percentage cut won't be as high as for a larger transaction. Ripple says that it can potentially make these transactions profitable. The start-up is currently working with 15 of the top 50 global banks including UBS and Santander.



Expansion

Chris Larsen, the chief executive of Ripple, said the company was investing the fresh funds in global expansion. "We have been expanding our office locations. We want to continue that and grow those teams, we want to be hiring so we can have engineers on the ground with local banking partners as you have to get in there with the banks to make sure you have a complete solution and make things as easy as possible," Larsen told CNBC in a phone interview. The company recently opened an office in Luxemburg and is considering Singapore and Frankfurt as the next locations. Blockchain - which is the basis for Ripple's technology - works like a huge, decentralized ledger for the digital currency bitcoin which records every transaction and stores this information on a global network so it cannot be tampered with. It's this technology that banks feel can be utilized in areas from remittances to securities exchanges. In the future, Larsen said that as an increasing number of devices come online in the so-called "Internet of Things", micropayments could rise. This is where Ripple could take advantage. "With a connected device a hundredth of a penny might need to be sent, that can't happen today. But we are working to make that happen and it opens up a new field of services and revenue for the banks," Larsen said. Experts said that blockchain could have a cost-cutting impact on many parts of a bank's business. A report from analyst firm Juniper Research claimed "in areas such as transaction settlement, the introduction of a blockchain-based system would substantially reduce both the risk of error and the time taken for error checking", but cautioned that the technology needs to be secure. "While blockchain technology offers the potential for increased speed, transparency and security across an array of verticals, there has to be rigorous and robust roadtesting in each unique use case before any decision is taken," Windsor Holden, analyst at Juniper Research, wrote in a report last month.



Acquisitions ahead?