Ripple Backs Institutional Credit Fund for Fintech and Payments Companies on XRP Ledger

Ripple is expanding its role in institutional lending by backing a new credit fund that will issue working-capital loans in its RLUSD stablecoin to fintech and payments companies through the XRP Ledger. The fund, built on the framework of Cicada Partners and Clearpool, aims to lend money in RLUSD to borrowers.

Cicada Partners will be responsible for finding borrowers, setting loan terms, and managing credit risk, while Clearpool is building the technical infrastructure needed to create and run the credit pools. Ripple's role in the plan is to invest as a limited partner, but it won't guarantee against losses if borrowers default.

The fund has already underwritten more than $860 million in credit, and Clearpool has facilitated over $930 million in institutional loans since 2021. Borrowers who qualify for the loans will receive RLUSD and repay their debt with the stablecoin, keeping its function different from XRP's use to cover transaction fees and minimum balances.

The RLUSD-XRP pair has generated significant trading volume across XRP Ledger pairs since it launched, with over $2.5 billion in trading volume and up to $900 million on the RLUSD-XRP pair alone. However, the product isn't ready to go live yet as two features used by the system are still under review by network validators.