Remittance business is always been booming as more and more people working abroad and sending money back. Most of this money goes via “Hawala” accounts which is insecure and illegal, but people do it as most of the “Hawala” transfers are done by labor workers who are on minimum wedges and cannot afford high bank fees.
These banking and traditional money transfer agencies have multiple stakeholders from Agent / over the counter agencies, banks, and receiving agencies. Over the years the advantage of these traditional remittance services includes flexibility and associability as agents are available in remote areas. This comes at a cost of high fees, delay (some time in days), and frauds.
There is also an option of online money transfer reply on mobile apps, banking interfaces, and receivers banking network. This is again a high fee transaction as there are multiple banks and exchange rates involved.
This is where blockchain technology can help. To reduce cost, generate transparency, increase security, and increase speed. With the speed of the transaction, currency fluctuations will be handled effectively. Blockchain works on the concept of Distributed Ledger which can serve as the backbone for a cross-border payment infrastructure that can potentially solve inefficiencies and provide a faster, secure, and more affordable service.
The average transaction cost for money remittance varies from 4 to 5% per transfer. This cost includes margins, exchange rates, sending and receiving agent fees, and settling banks. Blockchain technology can reduce this cost to a fraction by reducing all middlemen and overheads.
Kloden Technologies are a leader in Sales As A Service model in India and Asia Pacific Countries with our presence in most of the countries including remote services. We offer business development, implementation, and support services to our customers so they can serve the end customer very effectively.
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