Bitcoin Startups Hope To Tap Huge Demand In Africa For Small Business Loans
Africa-based bitcoin startup BitPesa and Germany-based Bitbond have partnered to bring financing options to businesses in Kenya, Nigeria, Tanzania and Uganda.
BitPesa is a pan-African bitcoin payments startup that initially launched in Kenya in 2013 as the continent’s first bitcoin company. Bitbond is a Berlin-based peer-to-peer crowd-lending platform for small and medium-sized enterprises globally
Bitbond claims to have processed over 16,000 loans worth $1.2 million since its launch, with 75,000 registered users from 120 countries. The platform describes itself as “the first global marketplace lending platform for small business loans” by leveraging bitcoin as a technology and payment network.
From Cryptocoins News. Story by Samburaj Das.
BitPesa enables African users to buy and sell local African currencies through bitcoin, with settlements directly transacting to and from bank accounts and mobile money accounts in Africa.
BitPesa’s payments rail enables near-instant and cheap transfers between East, Central and West African countries. Beyond the continent, BitPesa uses bitcoin to exchange African currencies into global currencies and vice-versa, without the need to use the U.S. dollar as a benchmark currency.
Bitbond’s partnership with BitPesa will now enable loan applicants in Africa to receive capital directly to a mobile money or bank account. While the loans are processed using bitcoin, the borrower sees the loan amount transferred to his or her preferred destination account “within minutes.”
Bitbond CEO and Founder Radoslav Albrecht said in a press release he sees plenty of potential as a result of the partnership, with 10 percent of Bitbond’s global user base from Sub-Saharan Africa.
He points to “a huge unmet demand for small business financing” in the region.
“This (partnership) means that a small business owner from Kenya can receive a loan funding from investors from all over the world via Bitbond and have the funds paid out to his mobile money account in 20 minutes. This is an unprecedented level of innovation and convenience in the entire online lending space.”
Bitbond’s expansion effort to boos its presence and outreach with partnerships with other bitcoin-based companies comes soon after raising $1.2 million in an equity funding round where it gained new capital for growth in potential markets.
Bitbond’s role includes checking the creditworthiness of applicants and studying the purpose of the loan to determine the required interest rate.
“We take numerous measures to ensure repayment of loans,” stated Chris Grundy of Bitbond, speaking to CCN in a previous interview. “This starts with emails and phone calls, in case of late repayments, and can culminate in the involvement of debt collectors to regain the owed sum.”
BitPesa has also had a fruitful start to 2017, closing a $2.5 million Series A round of funding to focus on customer acquisition and growth in Nigeria, BitPesa’s largest market.
“We are always excited to partner with companies that make doing business in Africa easier and more efficient,” said BitPesa founder and CEO Elizabeth Rossiello. Our customers are businesses looking to grow across the continent and beyond. Better access to efficient financing is a tremendous way to boost their growth.”
Read more at Cryptocoins News.
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