Is Future Of Remittance Services Bleak Because Of Blockchain?
Advanced encryption and security, low costs, instant transfers – these features of blockchain technology may soon revolutionize money transfer market.
Today’s Global Transfers
Why would you pay $30 for an international bank wire if you can use online remittance platform for $5? That’s an obvious choice. Various independent money transfer companies have a much better offer than mainstream banks. Through their own connections, remit platforms can offer cheap and instant international transfers. There are many leading companies in this business such as Western Union, PayPal, MoneyGram or TransferWise. PayPal has even grew to a position of being sort of an “official” way to send money online. Whenever you make a purchase at any online store, at the checkout you see PayPal’s payment gateway…
With the spread of globalization, we no longer limit ourselves to using only our local services. You can easily order goods from the other side of the World and have them delivered within a few days. People who run online businesses can look for their employees in all countries. Remote working is already a real thing. However, this means that there are thousands of international money transactions made every day. But if there are thousands of transactions and each of them costs a few dollars, this also means that people pay literally millions in fees everyday. And what if there is a new money transfer method, which can cost only a couple of cents to send money to any part of the world…?
Adoption of Blockchain Technology
Blockchain is used both for regular cryptocurrencies such as Bitcoin, but also for so-called “stablecoins” like Tether, USDC or newests Facebook’s project Libra. If everything goes well, soon all of the 2.45 billion users of Mark Zuckerberg’s social media platform will get an instant access to cryptocurrencies and blockchain technology. Many people will probably for the first time in their lives see that you can send money globally for a fraction of what mainstream banks charge.
Current Blockchain and Old-School Fusions
As cryptocurrencies are still not ready to officially hit the mainstream market, there are some cases of money transfer platforms utilizing blockchain technology to conduct regular bank wires, but faster and cheaper. If it turns out that problems of price fluctuations or technological barriers are too strong to rely on cryptocoins fully in our everyday lives, maybe such fusions of old school financial solutions being digitized and improved with blockchain is the way to go?
