Bitcoin is offering Nigerians in diaspora new ways sidestepping multiple exchange rates, high and sometimes hidden charges and the lack of interoperable platforms.
Although the financial technologies (FINTECH) ecosystem has provided appreciable solutions, exchange rate arbitrage opportunities remain. Nigeria occupies a special place among the countries who suffer the most.
Overseas Development Institute (ODI) had a report published in 2016 that Africans are paying the world’s highest money transfer fees; an average of 12 percent in fees to transfer money back to relatives in Nigeria. In addition to the huge fees, the foreign currency gets converted using uncertain exchange rates.
With Bitcoin, a new kind of money that is created based on mathematical proof and held electronically without any centralised banks or government authority, money can be sent from abroad to family or friends (beneficiaries) in Nigeria at extremely low fees and better exchange rates than banks and money transfer operators. But a bitcoin wallet is needed.
What is a bitcoin wallet?
Bitcoin wallets operate like a financial institution account, an area wherein the holder can send and receive bitcoins from different bitcoin users. This is available at Redimit or Binance.
Bitcoin wallets enable the sending and receiving of the cryptocurrency by adhering to the Bitcoin protocol. These wallets are intricate software programmes that enable individuals with little to no technical knowledge to interact with the Bitcoin blockchain to transact value globally, without barriers.
There are several Nigeria-primarily based and bitcoin platforms. A bitcoin wallet holder can purchase, send or receive bitcoins using Naira Nigeria; top of them are platforms like Binance, Redimit, Quidax and Patricia.
How to send bitcoins to Nigeria
Once the bitcoin is obtained the holder could move in advance and create a bitcoin sell order at Redimit with the quantity of bitcoin to be sent. The guidelines below will be helpful.
Four simple steps in bitcoin sell order
Visit RedimIT or any other bitcoin exchange and click on sell bitcoin. Enter the value of bitcoin in United States Dollar and the sender/receivers bank details. Copy Redimit’s wallet to send bitcoin. Upon receipt, Naira will be paid instantly into the receiver’s bank. After receiving the bitcoin, Redimit can pay Naira into the Nigerian Bank account.
Remittances to Nigeria from the diaspora have increased by 210.30 percent in the past decade. It rose from $5.66 billion recorded in 2010 to $17.57 billion as of November 2019.
The available options to send and receive money in Nigeria include Western Union, Ria Money Transfer and Payoneer. Other options which allow only receipt of money in Nigeria are Transferwise and Paypal.
So far, Chipper Cash, which was launched in 2014, is probably one of the easiest solutions to cross-country money transfer. But it currently works only in seven African countries, namely: Ghana, Kenya, Rwanda, Tanzania, Uganda, Nigeria and South Africa.
Recently, however, more cryptocurrency platforms are beginning to explore the opportunities available in remittances. Last year, Binance, a cryptocurrency exchange partnered with Flutterwave to allow Naira deposits on its platform.
In February 2020, Patricia Technologies Limited launched a debit card that enables users to withdraw money from their Bitcoin wallet at any ATM (Automated Teller Machine).
How long does sell order take to complete?
Sell bitcoin order on Redimit are usually completed within minutes. Order will be completed when admin has verified bitcoin in the admin wallet.
