“Money makes the world go round.” (It should be “around”… it’s round because of gravity, but nevermind). That’s from a song from the musical Cabaret if you remember. This begs the question: if the money is not flowing around, then what happens to the world?
Well, it might just indeed stop, which is why it’s actually essential to have money flowing around the globe. Not only that, the smoother the money moves around the world, the easier it will be to keep things going for everybody, not only those who actually do have the money.
Transactions are usually just a set of numbers in a ledger. But there is a real-life story behind each one. Think about some university student who ran out of money last night and can’t have breakfast this morning until his or her parents send them some fresh money. And that’s just a smooth, not so important example.
The important thing is that transferring money is not just about money, or making the payments industry richer. It’s also about enabling people all over the world lead better lives and fulfill their potential.
A real person
In this article, let’s talk about one such person. Erick Guitierrez. He was born in Sao Paulo, Brazil and he made a radical life decision when he was 21 by moving to Ireland because he wanted to have a chance to start from scratch. Not too long after that, he moved to Porto, Portugal, because he had a good chance for a nice life there working as a developer, and he already knew the language and the culture.
After living in Porto for a year, his friends back at home urged him to work on a side project. Mr. Gutierrez was getting a huge flow of questions and interrogations about his bold move across continents. So he set out to create a website full of answers.
He called it Euro Dicas. It started as a hobby but it grew so much that by autumn 2017 it was is a full-time job already. Mr. Gutierrez and his team (yup, he had a team by then) explained to people how to move from one country to another, declare taxes, pay them, get a visa and all the detailed information you need to know to move abroad.
It wasn’t long before Mr. Gutierrez found out that his business depended on overseas income and overseas workers. He was working with six full-time employers and more than 40 freelancers from all around the world. Most of the site’s business came from Brazil.
So he needed to transfer money quickly to his collaborators but found that the high fees, the long waiting times and the unreliability inherent in the traditional way of settling international transfers (the SWIFT system) were squeezing him.
In order to get around all the problems SWIFT has, Mr. Gutierrez tried everything. Remittance services, which are supposed to remove a lot of that friction (and sometimes don’t) and international payment services.
Traditional banks only work at office hours, so Mr. Gutierrez had to choose between doing is work, or being in the phone with a bank’s agent so that those transactions could be completed.
And it was still slow and expensive. Every transfer did cost about 10% of the amount in question, and it took five days to be settled. MoneyGram and Western Union were much faster but also more expensive. And the transfer had to be initiated by somebody on Brazil.
Even as new fintech companies as PayPal and TransferWise went online, they were still not that useful. Again, because the fees were expensive, and the services weren’t great at the beginning.
When you’re an entrepreneur trying to do your own job correctly and expand your own business, this amount of lost time and money are just anathema.
BeeTech global
Then, he discovered BeeTech Global. Back then it was a Brazilian startup that offered to settle international transfers for 150,000 customers scattered all around the planet. BeeTech is one of the many remittance services that are taking advantage of blockchain technology and cryptocurrencies (more specifically, Ripple‘s blockchain, software, and cryptocurrency). Ripple’s tech has made it faster, more reliable and way cheaper to perform this kind of service for BeeTech and many others.
BeeTech allows Mr. Gutierrez to get money from Brazil twice per month on a regular schedule without worries or uncertainty. The same service allows him to pay his employers, scattered throughout Europe, Latin America, and North America to trust him to pay them in time for the work that keeps his business going.
Payments arrive in one day, the process is reliable and transparent, which are critical factors in running smoothly a business that has so many freelancers in so many other countries.
It’s allowed him to scale comfortably using the business’ capital for growing instead of paying transfer fees. That’s possible because BeeTech’s fees can be 80% or less of those collected by competitors, so Mr. Gutierrez spends from 5 to 10 Euros per month on this.
Mr. Gutierrez considers that the service enabled him to grow his business from half a million visitors in 2017 to 1.5 million, on average, per month during the current year.
The growth has been on the 30-40% range. But more importantly, having access to a good, quick and cheap payments system has allowed him to hire collaborators in many places all around the globe.
Mr. Guitierrez is just one example, but he’s representative of lots of small entrepreneurs scattered everywhere in the world whose work and businesses could benefit greatly from better efficiency in international remittances.
According to the World Bank, low and middle-income countries alone transferred $466 billion in 2017. That is equivalent to 3.3 billion meals, 263,07 million monthly bills paid, and rent for 49.9 people.
Cash flow is the eternal challenge for emerging markets. The delay in a remittance can be the difference between paying the rent in time or buying a needed medicine on time, or (like it’s been for Mr. Gutierrez) paying in time the workers that keep your business going thus keeping their trust.
BeeTech is one of the first companies in the world to adopt Ripple’s advanced blockchain systems to settle international payments. It cuts times and costs by dramatic amounts, which is more meaningful for families and small businesses who can’t afford the waiting time nor the high costs.
Just to give you an idea, BeeTech eliminated SWIFT fees and transferences in every one of its corridors and substituted them with Ripple’s advanced transfers based on the blockchain. That move alone brought fees down from $20 to $2 per transaction.
Customers like Mr. Gutierrez are saving that money, and BeeTech as thus been able to increase its transaction volumes.
Beetech (supported by Ripple’s tech) is giving Mr. Gutierrez a trusted, more affordable, faster way to settle cross-border payments. And that’s its business lifeblood to be sure.
So instead of spending endless mornings at the bank trying to cut through all the red tape included in international transfers, Mr. Gutierrez can take care of is how his business and his company are doing. He expects to have twice as many employees by next year. His goal is for Euro Dicas to cover the planet in full and help more people become global citizens.
This is what Ripple can do for Mr. Gutierrez. But also for me, and you, and the world at large. And that’s also why Ripple already has more than 200 strategic partners in banking institutions and remittance services that are learning that adopting Ripple’s blockchain, platforms and cryptocurrency (XRP) is such a good idea. Everybody pays less; everybody is happier.
Ripple is making money move around the world in the smoothest possible way. And that, in turn, will keep the world moving as well.
Image courtesy of Pixabay.
Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.