The subsidiaries of Norwegian multinational telecommunications company Telenor has inked a partnership to launch a blockchain-based international remittance service.
According to a press release published January 8, Pakistan-based Telenor Microfinance Bank (TMB) has teamed up with Telenor’s Malaysian FinTech subsidiary Valyou, and Telenor’s Easypay, to introduce a blockchain-powered cross-border remittance platform in Pakistan. As detailed in the release, the service is anchored on blockchain technology created by Alipay, Ant Financial’s online payment platform.
The blockchain-based service was developed in an effort to expedite the facilitation of remittances between Pakistan and Malaysia, allowing real-time money transfers while eliminating the costs levied by intermediaries. According to Telenor Financial Services’ senior vice president, Pakistan currently accounts for roughly $1 billion of Malaysia’s home remittances.
As Ant Financial chairman and CEO Eric Jing stated explained in the release:
“The new remittance service is one of the examples of how emerging technologies can help countries meet their digital and financial inclusion goals.”
As it stands, “[h]ome remittances contributed to over 6% in GDP, equivalent to over 50% of our trade deficit, 85% of exports and over one-third of imports during FY 2017-18,” according to State Bank of Pakistan governor Tariq Bajwa.
This would not be the first time blockchain technology has been adopted in the global remittance industry, as evidenced by other countries including Kuwait. As previously reported, the National Bank of Kuwait has also launched a Ripple-based overseas remittance product, setting a precedent for other financial institutions in the Middle Eastern country as it becomes the first to pilot such project.
Across Japan, insurance company Sompo has also previously collaborated with pan-African digital payment platform BTC Africa in an effort to promote the “digitalization of global remittance services,” while expanding its “presence in the international remittance service market” as Sompo explores the potential application of the nascent technology to the field of insurance.