Ripple’s Reece Merrick Sees Stablecoins Changing Africa’s Fintech Market

Ripple Labs’ Managing Director, Middle East & Africa, Reece Merrick says Africa is leading globally in stablecoin adoption rate. Merrick spoke at a webinar he had with industry stakeholders from the region on how stablecoins are reshaping digital infrastructure in Africa.

Africa leads global stablecoin adoption by 9.3%

According to Merrick, Africa has a 9.3% adoption rate in the use of stablecoins for cross-border payments in trade and financial inclusion. Notably, many Africans use stablecoins to either send or receive money across international borders to relatives in the diaspora.

Additionally, many in the region rely on stablecoins to protect their savings from local currency fluctuations. Given that stablecoins are pegged to the U.S. dollar, it offers better stability to currency value for Africans.

Meanwhile, those engaged in cross-border trade also use stablecoins to pay for imports and services. Their business payments to international partners are conducted using stablecoins without needing a USD bank account.

Merrick highlighted how stablecoins are making everyday transactions seamless for people. He is suggesting that the asset class serves as a payment rail in the region. With stablecoins, Africans have faster and cheaper means of conducting remittances and trade settlements.

The Ripple executive considers Africa a key growth market for stablecoins and believes that adoption will continue to grow. He emphasized that Ripple USD stablecoin (RLUSD) remains easily accessible and cheap for Africans.

He listed Chipper Cash, Yellow Card and VALR as local partners, with which Ripple has established strategic business relationships to drive utility. Merrick explained that Ripple is keen on ensuring transparency and regulatory oversight to enable institutional adoption of stablecoin for payments.

Merrick also pointed out that from Ripple’s experience in the region, central banks are beginning to interact with crypto natives to better understand the sector. As such, concerns about stablecoins and crypto in general being used for illegal payments are starting to fade.

Ripple expands regional partnerships to drive RLUSD utility

Part of the growing success of the Ripple USD stablecoin can be attributed to its utility on the African market. 

The region has a huge population abroad that sends billions of dollars in remittances home using RLUSD and other notable assets like Tether (USDT) and Circle (USDC).

Beyond Africa, Ripple recently collaborated with a UAE-based bank, Zand. The mutually beneficial relationship would see Ripple supporting Zand’s own stablecoin, AEDZ, and the bank using RLUSD as well.