Remittance services are prone to getting disrupted by bitcoin and digital currency. CompareRemit, a website tracking various money transfers, lists companies dealing with bitcoin as well. When it comes to sending US Dollars to Mexico, bitcoin-based Bridge21 is the best option. The company is well ahead of TransferWise and other competitors in this regard.
It is no secret bitcoin will eventually disrupt the remittance sector as a whole. Bridge21 is a money transfer service using digital currencies to facilitate cross-border payments. This allows the company to give more money tor recipients and keep fees reasonably low. The company also raised US$200,000 in two separate funding rounds, according to Crunchbase. This goes to show there is a growing demand for cheaper and more competitive money transfer services.
Remittance Services Will Benefit From Bitcoin Adoption
What is of particular interest is how the company compared to industry leaders. Based on the statistics on CompareRemit, bitcoin-based remittances are the best option. Sending US Dollars to Mexico through Bridge21 results in higher rates. To be more precise, the recipient will receive more Mexican Peso for the same amount, despite the two-day transfer time. The transfer fee is also reasonably low at just 1%.
Comparing this to other companies, bitcoin is a clear advantage. Transferwise has lower rates, higher fees, and takes longer to process the transaction. Ria Money Transfer is quicker and offers lower fees, yet a far worse exchange rate too. In the end, Bridge21 provides the most bang for the buck, as no other companies come even close. To put this in numbers, bitcoin-based remittances provide gains between 1.7% and 3.7% for the recipient.
It is not surprising to learn bitcoin is a valuable ally in the remittance sector. Digital currencies alleviate a lot of fees associated with cross-border payments. Moreover, they provide somewhat quicker transaction and better conversion rates to customers. As more money transfer companies focus on using digital currency, the industry will get even more competitive. Traditional players, including the likes of TransferWise, will eventually fall behind.
One thing that will need to be addressed is how remittance companies can still be somewhat slow, though. In the case of Bridge21, the process takes two full days. That is a bit strange, considering cryptocurrency transactions take less than an hour to complete. It appears the bitcoin-based money transfer solutions may need to find a way to speed up transactions. Once that problem is solved, things will start to change very quickly in the remittance industry.
Header image courtesy of Shutterstock
Our Social Networks: Facebook Instagram Pinterest Reddit Telegram Twitter Youtube
