A leading bank service provider in Latin America has formed a new partnership with cryptocurrency exchange Bitex to enable cross-border payments leveraging the Bitcoin network.
Uruguay-based Bantotal is a financial service provider with ties to over 60 different financial institutions across 14 different countries. There are an estimated 20 million people using Bantotal’s services. The financial institution has announced a collaboration with Bitex – a local cryptocurrency exchange.
“Bantotal is one of the biggest banking providers in Latin America and is a huge player not just in Latin American but the greater Pacific,” said Sebastián Olivera, founder of the Uruguayan Fintech Chamber. “For me, Bitex provides a great solution for payments and they will be boosted by the structure and name of Bantotal.”
Following the newly formed partnership with Bitex, Bantotal customers will have access to a novel system for payment settlement thanks to its BDevelopers program.
“With this technology, banks can have access to an API and have control of the whole process of [cross-border] payment with visibility and reliability on the bitcoin blockchain,” said Manuel Beaudroit, Bitex Chief Marketing Officer.
Cross-border payments and remittances are particularly significant in the Latin American region and the new implementation would massively reduce transaction fees – up to five times cheaper according to Beaudroit.
The process of transmitting money across borders with local banks in Latin American can take anywhere between 48 and 96 hours with payments being routed through several financial intermediaries.
Bitex streamlines this process by converting local currencies into and from Bitcoin and ultimately settling the transactions on the blockchain. This is what happens behind the scenes, but for the user it is a seamless transaction where they only need to send their funds to Bitex.
“The purchase and [transfer] of bitcoin, Bitex does it all on your behalf. You as a user just send the money and Bitex takes care of the rest for you.”
Not only is Latin America one of the prime regions to benefit from the use of blockchain payment settlement systems, it is also one where there is a strong development community behind the blockchain technology.
While this is only a first step, Bitex’s Beaudroit hopes this partnership will blaze the path for businesses to adopt a similar peer-to-peer payment flow, which would contribute to an improvement in efficiency.
Santiago Siri, founder of digital governance startup Democracy Earth and advisor to Bitex, stated the company is aiming far beyond simply being a crypto exchange platform:
“It’s an ideal partner for banks to use bitcoin … as a way of connecting banks in a way that is not very common in the industry yet is fundamental for markets like Latin America.”