Crypto Remittance: Migrants’ money choice

Cross-border money transfer is the most discussed issue second to investments. It is a practical problem for many expatriates and immigrant workers. 

Forced by the COVID-19 pandemic, the remittance sector has grown from transfers via physical remittance stores to online transfers. 2020 witnessed World Bank data record global remittances to low- and middle-income countries climb up to US$540 billion. In the future, crypto remittance is expected to account for a much greater share in global annual remittances.

The countries that topped in remittance earnings in 2020 were India (US$83.1 billion), China (US$59.5 billion), Mexico (US$42.9 billion), the Philippines (US34.9 billion), and Egypt (US$29.6 billion). India remains the largest recipient of remittances since 2018. The chief driving factor of remittance flow happens through migrant workers’ fund transfers to their home accounts.

Countries Benefitting from Crypto Remittance

In recent times the bankrupt government of Sri Lanka is seen appealing to immigrant Lankans to send money home. Thereafter, El Salvador is one easy example of a nation that depends heavily on remittances. Remittances make up 20% of its GDP. In 2020, 70% of the Salvadorean population had been recipients of remittance payments. Therefore, this amounted to US$6 billion. El Salvadore government took a progressive step in making Bitcoin legal tender in September 2021. Moreover, the result could potentially cost remittance companies US$400 million a year, estimated by Nayib Bukele, president of El Salvador. 

“Everyone is watching if it goes well for El Salvador and if, for example, the cost of remittances drops substantially… other countries will probably seek that advantage and adopt it,” executive president of the Central American Bank for Economic Integration (CABEI), Dante Mossi, told Reuters.

Focussing Africa, South Africa is the greatest remittance sending market. The target region is chiefly the SADC countries. Remittances in South Africa have been historically expensive This averaged 14.4% in Q4 of 2020. 2019 saw up to 69% of South African adults with a formal account, including mobile money (RemitScope, 2021). Therefore, the adoption of cryptocurrency in Africa is increasing as it offers a swift and convenient channel for remittance payments.    

Also Read: 10 Reasons To Use A Crypto Payment Processor

Making a Difference with Crypto Remittance

Cryptocurrency offers a fast and convenient way for remitters to transfer money across borders at a much lower fee. While traditional remittance channels generally take around three days, crypto, remittance makes it possible in one business day. Thereafter, the in terms of cost, the remittance fee for traditional remittances averaged 6.5% in the fourth quarter of 2020 as opposed to less than 1% in the case of crypto transfers. 

HC Remit is a Bitcoin and other reigning crypto remittance software developed by HashCash Consultants. 

The blockchain-powered remittance software is designed to :

1. Replace EOD recon with real-time reconciliation of transactions
2. Eliminate SWIFT costs using free SWIFT blockchain-based messages which integrate seamlessly with your current infrastructure

HC Remit is in use to transact, monitor, and record asset and currency movement across borders. Moreover, it is a strong alternative to traditional systems such as SWIFT and payment gateways with its blockchain-enabled platforms for cost-effective, instantaneous, and auditable remittance transactions.

Finally

Crypto remittance is the future of cross-border fund transfer and is progressively gaining market traction offering stiff competition to the very expensive conventional remittance methods. 

Many remittance-dependant countries encourage by El Salvadore’s move to make Bitcoin a legal tender. Countries like Brazil, Ghana, and the UAE are also considering a similar move.