Bitwala says they are pleased to announce the company’s bitcoin-to-M-Pesa service. Users of the platform can now send bitcoin to an M-Pesa account in Kenya, Nigeria, Uganda, and Tanzania free of charge. M-Pesa is a widely used mobile phone-based money system used in Afghanistan, India and Africa.
The mobile currency is predominantly used in Kenya and Tanzania, therefore giving users in the region access to much-needed remittance services. The mobile money has allowed anyone without a bank account to transfer funds using a registered sim-card and has become a disruptive force within the region.
“We want to be a part of the mobile money revolution, and we’re stepping it up a notch by enabling anyone to send money to any M-Pesa account using bitcoins,” details Bitwala CEO Jörg von Minckwitz.
The payment startup Bitwala believes transferring money should be “fast, cheap and secure” for anyone in the world. In regions such as Kenya, where M-Pesa is used quite a bit to transfer money, Kenyans transacted $28 billion using the service in 2015. This number is sure to rise, says Bitwala, as mobile phone penetration in sub-Saharan Africa grows exponentially.
To send money to any M-Pesa account utilizing Bitwala’s latest service, users simply register with the platform, choose a “mobile money” payment, and then an invoice to be paid in bitcoin is sent to the user. The startup hopes the new service will become a reliable money transfer solution for everyone.
After the announcement was publicized, one bitcoin enthusiast asked, “What will prevent you from having the same problems as Bitpesa in Kenya?” Bitpesa has been trying for years to connect sub-Saharan Africans with the same type of solutions. But, in 2015, the startup had legal issues with the owners of M-Pesa, Safaricom, which took the case to the Kenyan High Court.
The mobile money operator made it difficult for Bitpesa to conduct transactions through Safaricom’s gateway services like Lipisha. Bitpesa has since been making other connections to help with the African remittance service by partnering with other financial institutions in Japan, China and more. Safaricom explained to the High Court that there were regulatory concerns with bitcoin, and companies are required to obtain a license for these types of transfers.