Hong Kong contains a significant population of migrant workers from Indonesia and smart company, Bitspark has decided to target this sector with a fresh Bitcoin remittance solution. Bitspark had previously launched introduced an almost identical remittance service which services the Philippines and this model will remain prevalent in the new service being introduced to Hong Kong.
Currently, 165,000 Indonesian migrant workers reside in Hong Kong and Bitspark intends to provide a low-cost method of sending money to Indonesia for this group. According to the official statistics from the Census & Statistics Department, ninety percent of Indonesian workers in Hong Kong are employed as domestic workers.
The remittance service works by a user entering a popular migrant worker hangout (known as ‘World-Wide house’) and handing over their hard-earned (Hong Kong Dollars) where Bitspark then coordinates with it’s respective Indonesian partner – ‘Artabit’ (who then enables the Indonesian recipient to collect currency) within 24 hours, from either a bank branch or local Post Office. Thus, Bitspark permits users of the service to deposit and withdraw cash and all without dealing with the intricacies of bitcoin wallets. This leaves Bitspark and ‘Artabit’ to transact in Bitcoin. Although Bitspark does work with ‘Artabit’ in Indonesia; Bitcoin exchange ‘Rebit’ is the preferred partner within the Philippines.
A promising statement from Bitspark Co-founder George Harrap, saw him state ‘We can now do same-day transfers in Indonesian rupiah to the other end.’
Bitspark migrated to a flat-fee pricing structure for remittances in contrast of the 1% charge for Philippines transfers (introduced last month). For example, Bitspark users in Hong kong that transfer funds to Indonesia will pay HK$25 (USD 3.22) whilst those customers that conduct Philippines transfers will pay HK$15 (USD 1.93). Therefore, within a short space of time – Bitspark has broadened it’s remittance scope as well as diversifying it’s customers base.
According to World Bank figures, and from the fiat point of view, Indonesia-bound remittances from Singapore can cost on average around 5% of the total amount being transferred, sometimes rising to as much as 10%. It is worth noting that the World Bank does not monitor cost of transferrals being sent from Hong Kong, however the Singapore-Indonesia remittance corridor does remain a worthy comparison.
Bitspark Co-founder Harrap added that his company is now transferring more capital for companies than individuals. Hong Kong foreign labour employment agencies remit monies to respective home countries regularly and in order to meet expenses related to overheads.
Harrap added that ‘Employment agencies will often have an office in the Philippines where they source many of the migrant candidates. These companies have bills to pay in the Philippines’ however when covering recent Bitcoin volatility; Harrap added that he declined to state Bitspark methods for insulating company funds from Bitcoin market movement(s). Harrap did state that the recent Bitcoin downward price movement hadn’t triggered losses for Bitspark and explained that he didn’t necessarily exchange remitted funds for Bitcoin immediately, but that he had an alternate and improved method.
Bitspark is successfully attempting to exploit the potential of Bitcoin as a method for cross-border transferrals, rather than Bitcoin as a speculative financial product. According to Harrap; Bitspark presently completes 10-20 daily transfers with volume doubling on a weekly basis. Corporate clients are driving-up higher volumes with remittances typically carried out fortnightly, rather than monthly remittances from individuals. Bitspark certainly appears promising.
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