How Migranet Will Reduce The Costs Of Migrant Remittances Through Blockchain And The MIG Cryptocurrency
While the causes driving international migration can be multifarious, one common trend among all migrant communities worldwide is their propensity to send money and goods back to their families in the countries of origin. What is otherwise known as ‘migrant remittances’.
According to the World Bank’s latest statistics, remittances to low- and middle-income countries reached a record high of $529 billion in 2018. Remittances have exceeded official development aid (ODA) consistently since the 1980s.
However, migrant remittances are far from costless and trouble-free. Due to the implementation of ‘know your client’ (KYC) rules and anti-money laundering procedures, among other factors, the global average cost of sending money to the countries of origin was estimated at around 7 percent in the first quarter of 2019, and at over 10 percent across many African corridors and small islands in the Pacific. Reducing remittance costs to 3 percent by 2030 is a global target under the Sustainable Development Goal (SDG). It also forms part of “Objective 20” of the Global Compact for Safe, Orderly and Regular Migration that was adopted by the United Nations earlier this year.
As was remarked by Dilip Ratha, head of the Global Knowledge Partnership on Migration and Development (KNOMAD), “Remittances are on track to become the largest source of external financing in developing countries. The high costs of money transfers reduce the benefits of migration. Renegotiating exclusive partnerships and letting new players operate will increase competition and lower remittance prices.”
Blockchain and cryptocurrencies are today among the most promising avenues to facilitate, speed up and reduce the costs of migrant remittances. According to a recent report by the European Commission, a new trend is indeed emerging among migrant communities to send money back to families in home countries through the use of cryptocurrency services. The blockchain network ultimately allows payments and transactions to be executed in real time, without the holders of currencies being forced to reveal their identity and with high levels of security. And by avoiding all intermediaries — banks, agents, etc. — costs are significantly reduced.
While several companies and startups are gradually adopting cryptocurrencies like Bitcoin to offer migrant remittances services as one of their ancillary activities, Migranet is today the only blockchain and AI platform that is dedicated solely to helping add speed, fairness, accuracy, and accountability into the global migration system. Through the use of AI and blockchain, Migranet will not only assist migrants with their immigration application process, by reducing processing costs by up to 90%, it will also offer remittance services through a localized Migranet exchange network and the use of its dedicated MIG cryptocurrency.
The MIG, which was launched a few days ago and which can now be purchased on a major Exchange platform, provides a fraud-free, corruption-free, user-friendly and affordable means to transact securely, including in the field of migrant remittances. Upon completion of the platform in the coming months, Migranet will, therefore, be able to offer one of the most innovative and efficient remittance transfer markets ever, thus contributing to one of the objectives of the UN Global Compact for Migration which is to reduce costs, improve speed, enhance security, and open up distribution channels to underserved populations, including for persons in rural areas and persons with low levels of literacy.
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