The remittance industry is a massive market worth billions of dollars. Every day, migrant workers from all parts of the globe send money to their families in their home countries via various remittance-focused firms such as Western Union, MoneyGram, and a handful of alternatives.
A Powerful Alliance
However, more than a few challenges are plaguing this method of money transfer. As such, Bithumb and Bitpay have joined forces to facilitate remittances and benefit immensely from this industry using the power of blockchain technology.
Singh also made it clear that the crypto payment facilitator’s primary objective for this year is to make bitcoin more readily available to the masses by assisting large retailers in integrating digital currencies as a payment method.
In a chat with CNBC, the official said that the bitcoin payment processing company’s alliance with the heavyweight crypto exchange is in a bid to leverage the $200 billion remittance market by processing payments between South Korea and the western countries.
For some time now, quite a number of remittance-focused firms have tried integrating cryptocurrencies into their operations to enhance the processing of a large number of transactions, in a bid to reduce transaction fees paid by both the senders and receivers of these payments.
Another great benefit of getting on the blockchain is to make the remittance process more secure, and eventually, quicker than what stands currently,
Apart from the issue of high fees, another great challenge is that receivers of these remittance payments living in remote villages often have to travel long distances to urban cities to collect the money from. This distance makes the whole process cumbersome and expensive.
With the new Bithumb-Bitpay partnership, Singh has made it clear that cross-border payments can now be made with only one percent transaction fee and a settlement time of one day. In his words:
“We’re trying to make it so that people can get money cheaper and quicker from suppliers internationally. So right now, someone in South Korea can pay a million-dollar invoice in the United States using Bithumb to buy bitcoin and pay the invoice, and BitPay will process that invoice and settle in US dollars the next business day.”
What’s in it for Both Parties?
In effect from April 2018, the bitcoin payment processor will stop servicing merchants who sell explicit sexual content, narcotics, research chemicals and many other goods and services.
The author firmly believes that BitPay’s alliance with Bithumb will help it recoup some of the losses it might have incurred following its new business policy.