African migrants using Bitcoin to send money home

[shogdite]

http://www.independent.co.uk/news/business/news/bitcoin-is-being-used-by-african-migrant-workers-to-send-money-home-10098169.html


Migrant African workers are increasingly turning to bitcoin to send money home.

BitPesa, a service that allows bitcoins to be transferred to Kenya and Ghana for a flat fee of 3 per cent, said its user base is growing by 60 per cent month-on-month. Elizabeth Rossiello, chief executive of BitPesa, told the BBC that a shortage of payment options in Africa is driving bitcoin use.

It’s also cheaper: that 3 per cent fee contrasts sharply with an average 12.3 per cent paid to money transmitters by Africans living abroad, according to figures by the Overseas Development Institute. The ODI said that total annual fees to money transmitters amount to $1.4 billion.

In some parts of Sub-Saharan Africa, MoneyGram and Western Union control 50 per cent of the remittance market while credit cards are available to less than 3 per cent of the population. Other web solutions like PayPal are not widespread and can also be expensive. Bank transfers are no better – they can be two the three times as expensive as other countries.

Africa is fertile ground for bitcoin. It has history with mobile money services that allow users to pay for good using a mobile phone as an alternative to cash or cards. A mobile money service called M-Pesa is now so widespread in Kenya that almost 70 per cent of the volume of all national payments is made through the service.

Toby Shapshak, a technology journalist, said that M-Pesa has become a financial institution in its own right. “You can pay school fees, you can buy groceries, I’m told you can even bribe customs officials using MPesa. The most important thing is that you can do it on the most basic of cell phone because Africa isn’t a smart phone continent yet,” Shapshak told the Guardian.

Bitcoin works with this local economy. Once it is received by a transmitter like BitPesa it can be converted into M-Pesa in Kenyan shillings.

While bitcoin is on the rise, liquidity might still be a problem. As a commodity, can also be subject to greater volatility than currencies, though remittance companies say they combat this by immediately converting transfers.

Transparency can also be an issue. Bitcoin users store a record on their computer of where every bitcoin is spent that acts as a virtual ledger – but the record does not show the identity of users. “From a law enforcement perspective, the danger is that the anonymity makes it an attractive proposition for criminals to use in terms of hiding the money trail we would use to get evidence against them,” Terence Chua, Singapore's deputy public prosecutor, told the Guardian.

[FeedbackLoop]

Is The Guardian citing a prosecutor from a country that hands out death penalties for victimless crimes as a way of saying that Bitcoin should be more anonymous than it is?

[BillyBobZorton]

All these people that are fucked by day 0 because of the bad luck of being born on a shithole of a country deserve to do better and Bitcoin is finally a way to give these people a realistic chance at generating wealth, specially when blockchain is accessible through SMS soon.
It will be huge. Just imagine, faucets alone will be great for all these people living in severe poor countries.

[countryfree]

3% fee, what a rip-off!
I see huge opportunities for shops to accept BTC in Kenya.

[dsly]

3% fee, what a rip-off!
I see huge opportunities for shops to accept BTC in Kenya.

I have been hearing about Africa being one of the first countries to use bitcoins for remittance. The fees can range upto 40-50% of the transaction amount. SO bitcoin is obviously the best solution for them

[Dick Valentine]

3% fee, what a rip-off!
I see huge opportunities for shops to accept BTC in Kenya.

3% is tiny compared to what they get charged by rip-off banks. I really hope more people become aware pf the huge savings there is for the remittance market as that would be huge for bitcoin.

[Bit_Happy]

There are a lot more poor people in the world than rich.
Nice exposure for Bitcoin and another sign that the media cycle is turning strongly positive. 

[BitcoinHeroes]

https://bitstake.info is doing this, they don't even need internet architecture, just telecommunications network.

[oblivi]

All these people that are fucked by day 0 because of the bad luck of being born on a shithole of a country deserve to do better and Bitcoin is finally a way to give these people a realistic chance at generating wealth, specially when blockchain is accessible through SMS soon.
It will be huge. Just imagine, faucets alone will be great for all these people living in severe poor countries.

It's already happening, snapcard can make SMS transactions workable right now:

https://bitcointalk.org/index.php?topic=334274.0

[countryfree]

3% fee, what a rip-off!
I see huge opportunities for shops to accept BTC in Kenya.

I have been hearing about Africa being one of the first countries to use bitcoins for remittance. The fees can range upto 40-50% of the transaction amount. SO bitcoin is obviously the best solution for them

Fees are more like 12-15% but BTC transactions should be done with the standard 0.0001 fee. Then the issue is to find an exchange in Africa which will only ask for a 1% fee.

[hdd3go]

Good to see that.

Crossing foreign exchange controls is why Bitcoin was born and what biggest advantage Bitcoin is.

[foxkyu]

glad to see bitcoin helping African migrants to send money home
this is the advantage using bitcoin
transfer in less than 30 minute, fee is very tiny, and can sent anywhere

[Gleb Gamow]

http://www.independent.co.uk/news/business/news/bitcoin-is-being-used-by-african-migrant-workers-to-send-money-home-10098169.html


Migrant African workers are increasingly turning to bitcoin to send money home.

BitPesa, a service that allows bitcoins to be transferred to Kenya and Ghana for a flat fee of 3 per cent, said its user base is growing by 60 per cent month-on-month. Elizabeth Rossiello, chief executive of BitPesa, told the BBC that a shortage of payment options in Africa is driving bitcoin use.

It’s also cheaper: that 3 per cent fee contrasts sharply with an average 12.3 per cent paid to money transmitters by Africans living abroad, according to figures by the Overseas Development Institute. The ODI said that total annual fees to money transmitters amount to $1.4 billion.

In some parts of Sub-Saharan Africa, MoneyGram and Western Union control 50 per cent of the remittance market while credit cards are available to less than 3 per cent of the population. Other web solutions like PayPal are not widespread and can also be expensive. Bank transfers are no better – they can be two the three times as expensive as other countries.

Africa is fertile ground for bitcoin. It has history with mobile money services that allow users to pay for good using a mobile phone as an alternative to cash or cards. A mobile money service called M-Pesa is now so widespread in Kenya that almost 70 per cent of the volume of all national payments is made through the service.

Toby Shapshak, a technology journalist, said that M-Pesa has become a financial institution in its own right. “You can pay school fees, you can buy groceries, I’m told you can even bribe customs officials using MPesa. The most important thing is that you can do it on the most basic of cell phone because Africa isn’t a smart phone continent yet,” Shapshak told the Guardian.

Bitcoin works with this local economy. Once it is received by a transmitter like BitPesa it can be converted into M-Pesa in Kenyan shillings.

While bitcoin is on the rise, liquidity might still be a problem. As a commodity, can also be subject to greater volatility than currencies, though remittance companies say they combat this by immediately converting transfers.

Transparency can also be an issue. Bitcoin users store a record on their computer of where every bitcoin is spent that acts as a virtual ledger – but the record does not show the identity of users. “From a law enforcement perspective, the danger is that the anonymity makes it an attractive proposition for criminals to use in terms of hiding the money trail we would use to get evidence against them,” Terence Chua, Singapore's deputy public prosecutor, told the Guardian.

Years from now, people will be looking back to see how bitcoin expanded and be shocked when they discover a large percentage of its success stemmed from the middle of Africa outward. Take about an evolution!

[OROBTC]

...

This is indeed great news.  Migrants can send money for cheap back to their families living in very poor countries.  Pay BTC "here", locals "there" get local currency.

I have to look into this for Peru.  Getting that license (or whatever) to transmit money looks like the b!+chiest part though. 

I hope that this idea takes off big-time.  One of the very best reasons for Bitcoin to exist.

[Monetizer]

3% is not too bad, to be able to buy bitcoin with my bank account in my country cost me nearly %15 above market price! It is not great but I should be able to make this money back easily when I go to sell more.

[Possum577]

These guys are smart! This is the kind of news I've been looking for, seeing bitcoin genuinely benefit developing nations, the world's poorest folks. That's the best part of capitalism...no one is automatically excluded for any reason.

Seriously, if there's a will there's a way. That's capitalism...Bitcoin is a beautiful example.

[orryde]

These guys are smart! This is the kind of news I've been looking for, seeing bitcoin genuinely benefit developing nations, the world's poorest folks. That's the best part of capitalism...no one is automatically excluded for any reason.

Seriously, if there's a will there's a way. That's capitalism...Bitcoin is a beautiful example.

Yes I was one example, bitcoin has been very helpful to me in a couple of months now and I am very grateful to people who make this all

[steven.G999]

These guys are smart! This is the kind of news I've been looking for, seeing bitcoin genuinely benefit developing nations, the world's poorest folks. That's the best part of capitalism...no one is automatically excluded for any reason.

Seriously, if there's a will there's a way. That's capitalism...Bitcoin is a beautiful example.

Yes I was one example, bitcoin has been very helpful to me in a couple of months now and I am very grateful to people who make this all

I also helped with all of this, because I am just an unemployed
This may also be able to reduce poverty

yes I really thank all parties involved in this case 

[Kprawn]

Mobile money services are going to take over the Africa continent soon. Yes it is very successfull in Kenya, but it's growing fast. A lot of the kenyan people work just across the borders and they taking the technology to those countries.

M-pesa has been around on the mobile for years now... Bitpesa is just making the process of converting and payment a lot easier.

I have done some contract work in some of those countries, so I know a bit about M-pesa. {When smart phones take off there, the transition to Bitcoin or other crypto currencies will be a lot easier}

Still good news for Africa. 

[Daniel91]

I know personally some people in Africa and what I hear from them is that in many areas of Africa have problems with electricity and internet access.
So, Bitcoin can be good solution for them but only when they improve infrastructure.
Until then, I'm afraid that most Africans will still have to use other payment services, like Western Union.