A San-Francisco based, Ripple has recently shared a ‘descriptive insights’ on why Europe needs ‘Just-in-time Payments’ if innovation is the key vision. It discusses, what’s holding back Small and Medium Enterprises (SMEs) to compete on a global scale and how can these entities mark their presence in Europe to double up the economy and tackle international trade effectively.
Ripple Encouraging Europe’s SMEs
So in its blog, Ripple highlighted the foremost tool to solve the existing issues that Europe’s SMEs are facing is ‘Just-in-time’ payments. To quickly define this term as quoting from Ripple official blog;
Just-in-time production is an increasingly common way of working for manufacturers, retailers and service providers around the world. It involves a business holding on-site the minimum amount of parts, materials, and stock needed to create a product or deliver service while relying on frequent, small-batch deliveries to ensure it can continue working at all times.
With just-in-time production driving global business growth, demand for real-time cross-border payments is more important than ever before: https://t.co/8Bm5r4urqL #blockchain pic.twitter.com/LxzfGWSqWn
— Ripple (@Ripple) February 21, 2019
This initiative of Ripple means that – it would allow small and medium firms to use ‘money’ effectively on ‘fostering the future innovation’ if the SMEs are not relying on large chunks for working capital which often required for supplies and stock. Addressing this, it states that such money can be used ‘to foster future innovation, by investing in hiring talents’. In contrasts to large scale businesses, SMEs would need something ‘that would help them meet the demand of new order as quickly as it arises. Ripple perceive that ‘this initiative’ would help these SMEs initiate the payment for outside countries in advance and assists them to receive ‘just-in-time materials’ as well.
Trust and Quick Payment
Citing Honda U.K, Ripple adds that these large organizations are already working for a decade thus have strong trust and relationship with firms outside of the regions – even if they don’t pay in advance for the materials. This is not the case of SMEs, it added. Nevertheless, it is quite difficult for small firms to get the materials without payment in advance and hence difficult to build trust and relationships – which would eventually affect the ‘good’s ability to move quickly’. In a similar context, Jiri Kobelka—CEO of Tatum Blockchain API elaborates that
“You can only enjoy trust if you have a long-term relationship with someone. If you are a new company, it’s very difficult to have this trust from the start. This is a barrier to innovation for anyone trying to build a startup that can compete on a global scale.”
Identifying these issues, Ripple, the blockchain firm with a decade of reputation in blockchain industry, believes that ‘the adoption of just-in-time payment would help SMEs of Europe to receive ‘just-in-time productions.
Those that do will become the preferred providers of the EU’s growing number of SMEs with plans to have an impact at a global scale, it concluded
So readers, what’s your stake on Ripple addressing SME’s existing issues with ‘Just-in-time’ payments? Share your opinion with us