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The Telenor group announced Tuesday the launch of the first cross-border remittance service in Pakistan based on blockchain technology at an event in Islamabad, according to a press release issued by the telecommunications company.
The service was introduced by Telenor Microfinance Bank, which offers Easypaisa, in collaboration with Valyou of Malaysia, a financial technology company that provides remittances to the under-bank communities.
Supported by the blockchain technology developed by the Alipay online payment platform, the service will allow Malaysia's Malaysian residents to send money home "instantly and securely" using Valyou, Telenor's remittance service provider.
What is blockchain technology?
A blockchain is a list of records called blocks, which contain timestamps and transaction data that are linked and protected using encryption. It is virtually impossible to affect or change. Shared universally through the blockchain (in other words, a chain of blocks), each has a record of each transaction, so there is no possibility of fraud or corruption. This removes intermediaries, such as banks or regulators.
To see: More information on blockchain. And do it now.
The launch of the service marks a "milestone in the country's path to promote financial inclusion," the statement said, adding that blockchain technology "would significantly increase the speed and efficiency of remittances from Malaysia to Pakistan" .
According to the dispensation, Alipay transaction fees will be exempted during the one-year service trial period, which will allow money transfers between the two countries at a competitive exchange rate.
All information stored, shared or uploaded through the remittance platform will be encrypted with advanced protocols in order to protect users' privacy, the statement states. This will ensure that all transfers are "highly secure and transparent".
In addition, blockchain technology will allow senders and recipients to track their money throughout the process.
The remittance service plan was unveiled at the Islamabad event, attended by the Governor of the Central Bank of Pakistan (SBP) Tariq Bajwa.
Offering his congratulations on the launch of the service, Bajwa said: "With around 20 billion dollars a year, international remittances are important from the point of view of overall macroeconomic stability and their positive impact on improvement. [the] lives of millions of families. Home remittances contributed to over 6% of GDP, accounting for over 50% of our trade deficit, 85% of exports and over a third of imports during [the] FY 2017-18. "
He added that the blockchain remittance service would complement the efforts made by the government and SBP to promote the transfer of domestic remittances using formal financial channels.
"This puts Pakistan on the map of very few countries in the world that have launched international remittances using blockchain technology," Bajwa said.
In December 2018, SBP reported that overseas Pakistani remittances rose from 12.5 points to $ 9.028 billion in the first five months of the fiscal year, from $ 8.021 billion in the same period of the year. ;last year.
According to the data, Malaysia had emerged as a significant new destination for remittances to Pakistan. During 5MFY19, inflows went through half a billion dollars for the first time while rising 53.3% to $ 616 million, from $ 401.78 million in the same period last year.
