According to a report by the World Bank, in 2013 the global average cost of sending remittances was 8.58 percent – a decline from the previous year but a large cut nonetheless. If a similar average fee remained in 2010, as a similar report suggests, that means that of the $5 billion Indonesian migrant workers were sending back home, the banks were getting their cut of $429 million.
But with bitcoin remittance services coming out of the woodwork recently, that cut could be taken down significantly. If they all only took a one percent cut of the bitcoin remittance, remittance services can make sure more than $374 million, that were once lost, can now go straight to the people that deserve it.
Looking at this data, one can see there’s a desperate need for people to be able to send money back home through bitcoin. In fact, that’s just what Bitspark saw and decided to react. According to an announcement, Bitspark will be expanding their bitcoin remittance service from Hong Kong to Indonesia in the coming months.
“We are excited to be able to bring our low cost service to Indonesia in partnership with PT Artabit,” said the Bitspark CEO George Harrap.
“Indonesia is an exciting opportunity and a key focus for us, it’s a very different market in terms of logistics and distribution than our existing Philippines services with many people using Post Offices as the primary cash pickup location, not third party remittance stores.”
Through Bitspark, Indonesian migrant workers can send their earnings in bitcoin to their families back home with little prior knowledge of the technology. When their family is notified, they can then pick up their cash in the national currency equal to the market value at the time of transfer.
“We are the cheapest option to send money to Indonesia and while other remittance services may support either bank pickup or post office pickups, we can do both, quicker and cheaper than the competition. It’s a win-win for the customer.”
The best part? There’s no need for the person receiving the sent money to know anything about bitcoin – at all. They never need to know it was sent with bitcoin, and they can have more money on average than before.
According to their research, more than 170,000 Indonesian migrant workers are employed in Hong Kong. While Hong Kong doesn’t bring in nearly as much as the worldwide remittance total, the practice of using bitcoin as a tool for remittance is something that could save a lot of people quite a bit of money annually.
Most of the Indonesian migrant workers work in Saudi Arabia, Singapore, the United Arab Emirates, Malaysia, Kuwait, Bahrain, Qatar and Taiwan. If bitcoin remittance took off in all of those places, money would go back in the pockets of those who earned it.
Last modified (UTC): January 20, 2015 09:23