Ripple is working with global liquidity and payments platform Arf to provide RLUSD-based settlement liquidity on the XRP Ledger (XRPL).

Blockchain outlet U.Today reported on Oct. 22 that the partnership focuses on expanding RLUSD use into cross-border payments and supporting companies' short-term funding.

The key is to reduce the burden of having payment companies' funds tied up until international remittance settlement is completed. Arf supplies RLUSD-based settlement liquidity to help qualified payment companies secure short-term working capital needed for cross-border transactions. It said this allows companies to raise funds needed during the settlement waiting period without tying up capital in multiple markets.

The repayment period for the settlement liquidity provided by Arf is 1 to 5 days. Arf said the short repayment cycle allows funds recovered to be repeatedly deployed into other payments. The aim is to improve the efficiency of stablecoin-based cross-border payments between global companies by reusing the same capital.

The two companies said the partnership targets a major bottleneck in the global payments industry. Companies often lock up significant capital in advance in each national market to keep transactions going. Arf said providing direct RLUSD settlement liquidity eases this structure and enables payment service providers to execute transactions without maintaining large pools of idle funds.

Ripple is also positioning the expansion of RLUSD utility as a pillar of its ecosystem expansion strategy. Recent development has also been carried out in a direction aimed at increasing the stablecoin's usability and adoption. The partnership is meaningful in that it strengthens settlement liquidity based on XRPL and links RLUSD not as a simple issued asset but as a means deployed into actual payment flows.

A key point to watch is how widely RLUSD settlement liquidity is adopted by licensed payment companies. If demand is confirmed for improving capital efficiency in cross-border payments, RLUSD's scope of use could expand further around payments.

Settlement liquidity is exactly the kind of use case @XRP Ledger and RLUSD are built to support. @Arf_One is bringing its approach to settlement liquidity to the XRP Ledger, using RLUSD to support short-term working capital for licensed payment companies as cross-border payments settle.