Nigerian primarily based SureRemit has launched a crypto token aimed toward cash despatched residence by international immigrants.
The startup — which is included in Mauritius — supplied pre-sales of its remittance centered tokens this week, earlier than a January 2018 ICO. SureRemit will use blockchain associate Stellar’s platform.
The corporate is connecting its crypto product — which isn’t redeemable by customers for money — to a community of pre-approved retailers in Nigeria, Kenya, and Rwanda. SureRemit plans to launch in India and the Center East within the second quarter of 2018.
Shoppers can use SureRemit’s app to current tokens as cost for issues akin to utility payments, pupil tuition, and on-line client items. African e-commerce big Jumia is amongst its service provider companions.
There’ll be no buy or switch charges for the tokens above face worth. SureRemit will generate income from companies, who pay a share on every token transaction, after which redeem the tokens (much less charges) for money from SureRemit.
SureRemit’s service provider community — in response to co-founder Samuel-Biyi — views the charges as the price of accessing a brand new pool of shoppers. “We’re an enormous channel to connecting them to the multi-billion greenback market of remittance inflows,” he mentioned “So our mannequin is transferring prices of remittances to the service provider aspect away from the sender aspect.”
Remittances — and the excessive charges charged by cash transmitters akin to Western Union and MoneyGram — signify an unlimited pool of world capital. In line with World Financial institution stats, roughly 250 million international migrants transferred $601 billion to their residence international locations in 2016. Greater than half, $441 billion, went to creating international locations: $39 to Sub-Saharan Africa, $69 billion to India, and $20 billion to Nigeria.
On international remittance charges, Sub-Saharan Africa pays the very best charges — roughly 10 % per $200 — of some other area.
Certainly one of SureRemit’s backers, 500 Startups, sees these excessive switch prices as a disruptive alternative for the enterprise. “The charges are horrible, and Western Union is ripping off individuals who can least afford it,” mentioned 500 Startups Accomplice, Marvin Liao. “It’s an enormous market…and a variety of these fundamental monetary and commerce wants that individuals have are nonetheless not being addressed successfully,” Liao mentioned of the potential for SureRemit’s crypto token product in Africa.
On the regulatory aspect, SureRemit’s Samuel-Biyi sees much less danger of their crypto token product getting used for money-laundering in comparison with different block-chain funds methods, akin to Bitcoin. “As a result of it’s not money redeemable and tied to explicit retailers…one wouldn’t be capable of rework tokens to money that simply. This makes it an unattractive cash laundering channel,” he mentioned.
To the query of why customers would use SureRemit’s crypto tokens versus different blockchain finance merchandise, Biyi named “pace and price” as aggressive benefits. “Remit tokens guarantee zero-cost, high-velocity cross-border transactions, which Bitcoin just isn’t presently optimized for,” he mentioned.
SureRemit has already confirmed market demand for cashless client cost and service provider packages by way of its predecessor, SureGifts product. SureGifts prospects buy digital buying vouchers by way of e-mail or SMS, and use them for cost at 300 associate retailers in Rwanda, Nigeria, and Kenya. SureRemit plans to leverage this community for its new remittance centered crypto token.