Bitcoin companies Bitrefill and Celery have announced a partnership that will enable users based in the US to send instant mobile airtime to mobile subscribers in more than 100 countries around the world. The partnership was announced at the International Money Transfer Conference held on Tuesday March 23rd, 2015.
How It Works
A sender who wants to top up a mobile phone in any of the more than 400 supported networks in 113 countries will log on to the Bitrefill website, and check if the number he wants to send to is supported. Next, the sender will select a price plan, and then send money to Bitrefill’s bitcoin wallet address. Like other bitcoin remittance services, there is also the option of scanning the wallet address’ QR code, which is also available on the site.
Celery CEO Ilya Subkhankulov adds that the platform hides the “complexities” of using Bitcoin from the user, while providing its benefits. A sender can also link to his bank account and choose an amount to serve in the currency of the receiver.
Global ‘Rebittance’ – Statistics
According to estimates provided by Bitrefill’s CEO Sergej Kotliar, the global prepaid mobile remittance market current stands at US$ 2 billion per annum. He however added that it is a market that is “growing quickly.” In his view South Asia has emerged as a clear frontrunner in the market. He singled out India, Bangladesh, Pakistan, Indonesia and Malaysia. Kotliar also included several African countries as active including Ghana, Cameroon, Nigeria, Egypt and South Africa.
Bitrefill has scrapped fees for India, which includes both exchange fee and currency conversion. As a market, India presents a tantalizing opportunity. In 2013, the country received US$70 billion in remittances according to data provided by the World Bank. The US-India corridor was also singled out as one of the highest remittance corridors in the world.
Remittance Fees Still Too High
In a report released by the Overseas Development Institute entitled Lost in Intermediation, authors Kevin Watkins and Maria Quattri argued that remittance fees in Africa were too high. For example to send US$ 200, Africans paid 12% in remittance fees, which is almost double the global average. If the remittance fees were to come down to about 5%, the African diaspora would be able to send US$ 1.8 billion more to a continent that does really need the money. According to the same report, US$ 1.8 billion would be able to put 14 million African children through primary or elementary school, and still spare enough change to improve sanitation for 8 million people, or provide clean drinking water for 21 million.
However weak regulation, competition and other factors have conspired to make remittance expensive, something that prominent Africans such as Kofi Annan have described as “unethically expensive.”
With the growth of apps such as Bitrefill’s and others, it can be hoped that more remittance services will be availed, and hopefully bring the costs of global remittance in Africa and elsewhere to more acceptable levels.