Ant Financial uses blockchain to make money transfer cheaper
Ant Financial Services Group, an affiliate company of Jack Ma’s Alibaba Group, and GCash launched a new cross-border remittance service based on blockchain technology on Monday. Standard Chartered Bank is the core supporting bank on the initiative.
Ant Financial in a release described the new remittance service as a cheaper alternative to traditional means to send money overseas and is currently limited to transfers between Hong Kong and the Philippines. Customers can with a few taps through AlipayHK’s mobile phone application, have money transferred within seconds to a GCash user.
In a first, the new remittance service will allow cross-border transfers through e-wallet platforms, using blockchain technology developed by Alipay, the online payment platform operated by Ant Financial. The service means individuals between Hong Kong and the Philippines needing to send money home can do so in a more convenient manner, avoiding long queues, in a transparent and secure way and avoid the fees incurred with exchange rates.
Blockchain delivers faster
Earlier this year, Jack Ma attempted a $1.2bn takeover of money transfer company, MoneyGram, but was blocked by the US government on security grounds. According to Bloomberg, Ma said at the launch event in Hong Kong, “At the time we wanted to [buy] MoneyGram and overhaul it to help people all over the world solve this issue. Due to reasons from the US our deal with MoneyGram did not succeed, so I said, ‘Let’s make one better [than MoneyGram]’ that uses the most advanced technology.”
Ma added that “the impact of blockchain to people and society will be greater than we can ever imagine”.
Alipay’s blockchain technology streamlines the remittance process by speeding up delivery and bringing more transparency to a process that can be cumbersome. Through the blockchain platform, the sender and receiver can track their money at every point along the way – from when the remittance application was made, until when the receiver successfully obtains the money. It also drastically reduces costs while enhancing security when sending money across borders.
Based on the smart contract, once a user submits a remittance application, all network participants including AlipayHK, GCash and Standard All information stored, shared or uploaded through the blockchain remittance platform is further encrypted with the most advanced protocols to protect the user’s privacy.
The service will allow for round-the-clock, real-time money transfer between Hong Kong and the Philippines using a competitive exchange rate with much lower transaction fees. During the three-month trial period fees are waived. Jennifer Tan, CEO of Alipay Payment Services said: “We are very excited to introduce this new remittance solution to our users in Hong Kong, and in particular to the Filipino community in the city. What used to be a long process of physically going to a remittance booth, queuing in line for hours and filling out forms, is now easily and securely done over the mobile phone in just a few seconds.
“Together with GCash, we aim to provide Filipino expatriates a more convenient, seamless experience to transfer money back home to their families in the Philippines. We will also continue to provide tailor-made solutions for our customers as we aim to enhance their daily lives through our secure and fuss-free approach.”