Ripple and Arf are introducing RLUSD-based settlement financing on the XRP Ledger (XRPL), giving licensed payment companies access to working capital while they wait for cross-border payments to settle.
The partnership, announced by Arf on 22 October, will initially provide financing directly on the network. Arf, a settlement liquidity provider based in Zug, Switzerland, says it handles approximately $10 billion in global settlement volume each year.
The arrangement is aimed at payment companies that need temporary liquidity between sending funds and receiving the final settlement. Repayment generally takes between one and five days, according to Arf, after which the capital can be used again for other transactions. The company says its existing funding turns over four times a month.
Ripple also outlined the availability of RLUSD working capital for licensed payment companies in a post on X on 22 October. Through Arf, participating financial institutions will be able to manage fiat and stablecoin treasuries using its bank accounts in major financial centres, while the blockchain infrastructure operates in the background.
Arf intends to transfer more of its financing operations to XRPL’s native lending system once the necessary infrastructure is available. The proposed Single Asset Vaults would pool and manage funds on the blockchain, while the Lending Protocol would allow loans to be issued from those pools.
Credit assessments and working capital decisions would remain Arf’s responsibility outside the network. XRPL documentation says the system is designed to support fixed-term lending from pooled assets, including the recording of loan conditions and the management of repayments. Loan administration would take place on the ledger once the lender and borrower had agreed their terms.
Ripple’s institutional credit framework, published in June, identifies two technical specifications supporting the model. XLS-65 sets out the design for Single Asset Vaults, while XLS-66 defines the Lending Protocol and how pooled capital can be issued as loans.
Both XLS-65 and XLS-66 are amendments to XRPL rules and require validator approval before they can operate on mainnet, the network’s live transaction environment. The LendingProtocolV1_1 amendment is also required to update the vault and lending rules.
RLUSD would be used for loan disbursements and repayments, increasing the role of dollar-linked stablecoins in payment settlement. XRP would continue to support the network through transaction fees and reserve requirements for accounts and certain ledger objects.
Soil, a fintech lending platform operated by institutional asset manager Orqo Group, is also preparing to use the proposed system. Its institutional vault plans involve pooling RLUSD from institutional lenders, with blockchain records used for loan accounting and reporting.
Separately, Clearpool and Cicada Partners are developing an RLUSD lending project for fintech, payments and cryptocurrency businesses. Clearpool is building the lending infrastructure, while Cicada will choose borrowers and oversee credit risk.
Arf has already built an implementation based on the proposed protocol and will continue contributing feedback as a design partner. It plans to move its programme to XRPL’s native lending infrastructure once the required amendments are activated on mainnet.
