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Africa is traditionally a slow adopter of new and emerging technologies. When it comes to the blockchain, the story is different as many countries on the continent have already leveraged distributed ledger technology (DLT) for transaction processing, agriculture, and remittances. BitPesa, a secure, fast, and cost-effective digital currency exchange that fast-tracks transaction processing to and from Africa, has collaborated with Japan’s biggest remittance service provider SBI Remit, to build a blockchain solution that allows Africans to buy goods from Japan easily.
These two companies are using blockchain to improve the efficiency of transaction processing, enable seamless cross-border payments, smoothen business processes, and allow Africans to eliminate the hurdles of international business that plague the continent. With this solution, Africans who want to buy goods from Japan will deposit money in their local currency without worrying about converting to a different currency. The money will then be made available to their Japanese partners using SBI Remit. With lower fees and fast transfer, these funds could reach their destination (Japan) in seconds and not have to be held up by the banks’ standard wait time of one to two weeks.
The pact is to enhance trade between Japan and Africa, with a focus on key industries including electronics, used cars, and cosmetics. Observing the current trade process shows why this partnership between BitPesa and SBI Remit is essential. For instance, for a Kenyan to purchase a used car from Japan, the Kenyan will have to use a bank that converts the local currency to a G20 currency, which will then be converted to the Japanese yen before reaching its final destination. This cumbersome process, though real, still doesn’t speak well in a world with a lot of technological advancements. Thanks to the blockchain technology, it is about to change for the better.
This collaboration will improve trade in Africa and help eliminate some of the bottlenecks that prevent international businesses from operating in the continent, including inadequate financial infrastructure, poor business, and technology integration, as well as general market conditions.
It would also increase business efficiency and allow the two continents to trade smoothly. For Japan, this is a new gateway to strengthen its business operations with Africa and hopefully enter new markets. Though this is the first time SBI Remit has partnered with an African company, the transition will be smooth as BitPesa has already got a grip on the African market, with banking networks in some of Africa’s biggest economies, including Nigeria, Uganda, Kenya, Tanzania, the Democratic Republic of Congo, Senegal, and more to come.