Today Arf and Huma launch the world’s first on-chain liquidity solution for cross-border payments, a significant development in the financial technology sector. This initiative has been launched to address the long-standing challenges associated with liquidity and transparency in international transactions.
Despite the globalized nature of today's economies, cross-border payments are often slow, expensive, and opaque due to the need for pre-funding and the corresponding counterparty risks. Financial institutions need significant liquidity for same-day cross-border settlements, with an estimated $4 trillion currently locked in pre-funded accounts globally.
Arf's solution revolutionizes this process. By offering short-term USDC-based working capital loans, Arf allows financial institutions to make immediate settlements for cross-border payments in USDC, thus eliminating the need for pre-funding. This shift doesn't just enhance the speed of these transactions, it also opens the door for broader coverage and higher transaction volumes.
Arf Co-founder and CEO, Ali Erhat Nalbant, elaborates, “By partnering with Huma, we are able to bring receivable-backed lending on-chain, thereby amplifying our ability to enhance transparency in cross-border payments. We remain committed to making liquidity more accessible and facilitating transparency in cross-border payments through the right digital assets.”
In collaboration with Huma, Arf is introducing the world’s first on-chain credit solution for cross-border payments. This solution, constructed on Huma's infrastructure, provides a level of transparency and traceability in the sector that did not exist before. Arf tokenizes cross-border payment orders through Huma and uses them as collateral to borrow from lending pools, making every transaction, including loans, repayments, and receivables, visible on the blockchain. This transparency does not compromise privacy, ensuring a safer environment for working capital.
Huma Finance Co-founder and CEO, Erbil Karaman, adds, “Our collaboration with Arf is a reflection of our shared vision to create a more equitable financial ecosystem. By enhancing liquidity access and promoting an unprecedented level of transparency, we aim to make remittances more efficient and affordable. We look forward to collaborating with Arf to further the progress of global finance.”
The introduction of this on-chain solution marks a significant advancement in the fintech space, showcasing the application of blockchain technology in real-world lending and cross-border payments. As the industry moves forward, solutions such as these will likely play a key role in shaping the future of global finance
View the Arf Credit Line solution on the Huma dApp.
To learn more about the launch, join our upcoming Twitter Spaces with Arf on Thursday, July 20th 2023 at 5 PM UTC.
About Arf: Arf is a global liquidity and settlement platform for licensed financial institutions, offering digital asset-based working capital credit lines and settlement services with fiat on- and off-ramp capabilities. Arf Credit Line is a short-term, USDC-based working capital credit line designed to enable licensed financial institutions to make cross-border payments without the need for pre-funding. Committed to transparency and overcoming liquidity constraints, Arf strives to empower financial institutions worldwide. For more information, please visit www.arf.one.
About Huma Finance: Huma Finance is a pioneering income-backed DeFi protocol that aims to onboard the next generation of DeFi users. By allowing individuals and businesses to leverage their income for DeFi lending, Huma Finance opens the doors to decentralized finance for everyone, regardless of their crypto holdings. Learn more https://huma.finance/.