Venture-backed firm BitPesa has partnered with Japan’s remittance service provider SBI Remit to bring cross-border blockchain payments to Africa.
On Monday, CCN reported that the partnership will see the two companies utilizing blockchain technology to make it easier for Africans to buy Japanese products. With the help of blockchain, the companies expect to get rid of challenges accompanying the transfer of funds between African traders and Japanese exporters, resulting in traders enjoying faster cross-border payment transfers with improved efficiency and more stringent security.
The partnership will focus on a number of industries, including used cars, electronics and cosmetics. This is expected to foster strong business ties between Japan and Africa. The partnership will especially benefit the used cars industry—the leading business between the two continents.
According to BitPesa founder and CEO Elizabeth Rossiello, traders stand to gain a lot from this partnership since “they don’t need to do any conversion.” Traders will be able to deposit funds directly to BitPesa’s accounts in their local currencies. Once the funds have been deposited, BitPesa will disperse the funds to their Japanese counterparts at SBI Remit, who will proceed to pay clients.
From this partnership, traders will enjoy easy transfer of funds, lower fees, and they will also not have to deal with currency conversion. Moreover, through the BitPesa and SBI partnership, transactions will be much faster than the two-week duration given to by local banks. It will also reduce the volatility risk that comes with forex conversations.
Enabling cross-border payments will also help open up business between Africa and Japan. The latter will be able to tap directly into BitPesa’s digital exchange platform, which has a presence in Democratic Republic of Congo, Senegal, Uganda, Tanzania, Nigeria, and Kenya. Traders from these countries will now be able to pay for goods from Japan easily.
Asian traders have been finding it hard to launch businesses in Africa due to fund transfer bottlenecks. Transferring funds from local currencies to a G20 currency has not only been time consuming but also expensive. Similarly, even transfer of funds locally within African countries requires the local currency to be converted to a G20 currency to facilitate this transfer.
With the BitPesa platform, Rossiello said the transfers can be done on their platform and would be more affordable and cost effective than conventional approaches. Both companies are optimistic about working together to grow business in Africa and Japan.
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