Alipay powers Pakistan’s “first” blockchain-based cross-border remittance service
Alipay’s technology is the fintech fuel for the launch of Pakistan’s “first” blockchain-based cross-border remittance service.
This development is all very much in-house and between friends. The service is provided by Telenor Microfinance Bank’s (TMB) Easypaisa and Valyou in Malaysia – who are both subsidiaries of the mobile operator Telenor Group.
In addition, Alipay’s blockchain is the backbone – and in March 2018 TMB got a $184.5 million investment from Ant Financial (the parent of Alipay) in return for a 45% stake in the bank.
With the launch, Tariq Bajwa, governor, State Bank of Pakistan, says: “This puts Pakistan on the map of very few countries in the world that have launched international remittance using blockchain technology.”
According to Bajwa, international remittances stand at around $20 billion per year and are “important from the perspective of overall macroeconomic stability and their positive spillover in improving lives of millions of families”.
He adds that home remittances contributed to over 6% in GDP, equivalent to over 50% of Pakistan’s trade deficit, 85% of exports and over one-third of imports during FY 2017-18.
Alipay explains that all information stored, shared, or uploaded through the blockchain remittance platform will be encrypted with “advanced protocols in order to protect users’ privacy”.
The service will make round-the-clock, real-time money transfers between the two countries, with Alipay’s transaction fees waived during the one-year trial period.
Alipay adds that the Pakistani government recently enhanced its National Financial Inclusion Strategy through a five-year plan that aims to create three million jobs and additional exports of $5.5 billion by improving SMEs’ access to financing.