And cashU prepaid cards are just one way to top up a cashU account, as
cashU cooperates with Ukash and several other payment systems to make it truly globally available.Yes, for the first time there is a cash deposit method for purchasing bitcoins in Pakistan, Nigeria, Turkey, and through UKash this becomes available in Argentina, Uraguay, Bolivia, and Mexico (among dozens of others).
I've added wiki pages for both CashU and UKash:
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http://en.bitcoin.it/wiki/CashU -
http://en.bitcoin.it/wiki/UKashplease excuse my profanity, but IMHO a premium of 15% just for buying BTC doesn't look like a business offer you can't refuse. Add to that the additional costs incurred on the merchant accepting bitcoin. And what is the merchant supposed to do with his BTC? convert them back to USD? or to Yuan??
This might be a first attempt to spread a small number of coins into those countries, but, honestly I don't get the "big picture" here.
Of course the added expenses in converting from cash through payment intermediaries like CashU will limit bitcoin's usefulness in the instances where that is needed. But compare the costs to Western Union though and to other methods of sending money from one part of a country to another, or internationally within Africa or overseas, and this doesn't end up being such an uncompetitive rate.
Here's an example of why this matters:
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http://pymnts.com/commentary/Tips-for-2012-Understanding-Payment-Behavior-of-African-Households-A-Vast-and-Untapped-Market/That shows that more than half of remittances do not use mobile payments.
Few mobile payment networks support international remittance transactions so that is one reason for that.
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http://technology.cgap.org/2012/03/21/what-do-international-remittances-mean-for-mobile-money-cgap-releases-study-on-remittancesBut bitcoins won't just be useful as an alternative to Western Union for remittance transfers for the continent. They'll be useful for a wide variety of transactions -- they can be used to pay for a commercial shipment electronically so that the delivery driver isn't carrying large amounts of cash, for instance. Bitcoins will be useful for travelers who wish to convert out of the currency in one country and then used to acquire local currency in the next.
So even with a high level of friction when buying bitcoins using CashU, once bitcoins are acquired they can circulate without being converted back to fiat outside the local community.
This is sure to happen since anyone can function as an exchange. This exchange function is one that has almost no barrier to entry and could be profitable for those who begin to offer this service. The techies at the cyber-cafe are likely one example of where these first exchanges will occur -- especially since that's where tourists are found. Or those already operating as exchange agents might start participating as adding bitcoin to the mix is just a small additional effort.
Keep this in mind ... with each Western Union transaction sucking a minimum of 10% of the payment, and mobile payments in the 5% range for smaller payments (e.g., under $40 range), bitcoins when purchased through CashU even don't need to change hands twice before they've become a better value as a payment system than had the same amount of funds been transferred through the alternatives.
The key though is that previously there was no way to seed this. This CashU option actually gives the ability for entrepreneurial individuals on the ground there to get bitcoins into their hands so that they have something to use to start trading.
Next what is needed are some stories of actual bitcoin commerce occurring. For instance, there are many tech and business incubators on the continent - a perfect place for bitcoins to begin circulating among a small group of willing participants who generally are among the early adopters and wouldn't entirely resist trying something new like this.
