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The Swiss-regulated global payment and banking platform, Arf, with the backing of the Stellar Development Foundation, has unveiled a groundbreaking financial solution. It provides unsecured short-term capital financing based on USDC (USD Coin) for licensed financial institutions worldwide. This innovation aims to address liquidity challenges commonly faced by payment and money transfer companies, especially in the cross-border payments sector.
Prioritizing Acceleration, Cost Efficiency, Transparency, and Inclusivity:
Improving the speed, cost-effectiveness, transparency, and inclusivity of cross-border payments is a top priority for global economic development and prosperity. However, cross-border payments remain a complex industry, particularly for capital-constrained payment and money transfer firms. Solutions that merge Web3 and traditional finance can play a crucial role in overcoming these challenges.
The Arf and Stellar Development Foundation Collaboration
Arf, a global payment and banking platform, has partnered with the Stellar Development Foundation, a nonprofit organization supporting the growth of the open-source Stellar network. Together, they aim to address liquidity challenges faced by payment and money transfer companies operating across international borders.
Arf's Solution: The Arf Credit Line
Arf's innovative solution, known as the Arf Credit Line, is built on the Stellar network and backed by USDC Circle. It offers qualified licensed financial institutions worldwide access to unsecured, short-term (1 to 5 days) working capital. With the Arf Credit Line, financial institutions can settle transactions with their partners in desired countries on the same day without requiring advance funding or additional collateral. This solution eliminates the capital-intensive business model for senders and counterparty risk for recipients in cross-border payments. Furthermore, since all these transactions occur within the USDC network, monetary transfers can be transparently tracked without intermediaries.
Unlocking Trillions of Dollars
According to Arf co-founder and CEO Ali Erhat Nablı, “Today, there are over $4 trillion in pre-funded accounts sitting idle, which could be used for global payment growth instead of sitting dormant.” The Arf Credit Line releases this locked capital, stimulating trillions of dollars in industry growth. Currently, Arf assists over 800 money transfer locations worldwide in conducting treasury settlements with their partners on the same day, enabling them to compete with global players effectively.
Stellar Development Foundation's Perspective
Denelle Dixon, CEO and Executive Director of the Stellar Development Foundation, expressed their support for Arf's blockchain-based solutions aimed at addressing liquidity constraints in cross-border payments. She stated, “Our commitment to making financial services more accessible for all is reinforced by solutions that define categories, such as the Arf Credit Line.”
Impressive Initial Results
Within four months of its launch, the Arf Credit Line has provided over $80 million in loans to licensed financial institutions, resulting in a total USDC volume of $150 million within the network. The Arf Credit Line serves as a remarkable example of how USDC on the Stellar network can be leveraged for working capital financing while enhancing the transparency, accessibility, and real-time nature of settlements.
About Arf
Arf is a globally regulated payment and banking platform that eliminates the capital-intensive business model in the cross-border payments industry. It offers licensed financial institutions access to digital asset-based working capital and settlement services with fiat currency input and output capabilities.
