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Alipay of Ant Financial is implementing blockchain technology to feed a cross-border remittance service for the Telenor Microfinance Bank (TMB) of Pakistan and Valyou of Malaysia.
The agreement is designed to provide a faster and cheaper method for Pakistani expatriates working in Malaysia, who send about $ 1 billion a year to their country of origin.
The offer of Alipay claims to be Pakistan's first blockchain-based cross-border remittance service. It is supplied to the Telenor Group, which owns and operates Telenor Microfinance Bank in Pakistan and Valyou in Malaysia. The blockchain service will carry out 24/7, real-time money transfers between the two countries at a competitive exchange rate, with Alipay waiving transaction fees during the one-year trial period.
"The new remittance service is one example of how emerging technologies can help countries achieve their goals of digital and financial inclusion, we are thrilled to be part of Pakistan's financial inclusion efforts and are dedicated to exploring the discoveries and apply to more people in more places, "said Eric Jing, president and CEO of Ant Financial, in the press release.
In 2009, Telenor launched a mobile banking service without branches in Pakistan called Easypaisa, which now serves 20 million Pakistanis. The Easypaisa service will be used to receive cross-border remittances and will allow Pakistani consumers to pay their bills and buy both online and at the 70,000 stores that accept it. Ant Financial took a 45 percent stake in TMB last year. In 2016 TMB acquired Prabhu Money Transfer, a licensed money service company in Malaysia that provides international remittance services and renamed Valyou.
"Currently, Pakistan receives about $ 1 billion in home remittances from Malaysia and this Easypaisa-Valyou collaboration will change for the better," said Roar Bjærum, senior vice president of Telenor Financial Services, Telenor Group, in a press release.
The spotlight on remittances has been very strong in the last decade, as the World Bank and the G20 nations have highlighted both the high economic impact of remittances on developing countries and the way in which the high costs of sending and receiving money unduly penalize unjustified and undervalued consumers.
Pakistan has received almost $ 21 billion in remittances from countries around the world, making it a major source of revenue.
"Home remittances contributed to over 6% of GDP, accounting for over 50% of our trade deficit, 85% of exports and over one third of imports during the 2017-2018 fiscal year. ", noted Tariq Bajwa, Governor of the State Bank of Pakistan in the press release.
