Africa has some of the fastest growing economies in the world and its economies benefit greatly from international remittances entering the continent. Diaspora Africans have been supporting their relatives by sending them money for decades. However, traditional money transfer operators such as Western Union and MoneyGram have been overcharging their customers for years. By sending money using bitcoin instead, individuals in several African countries can reduce the cost of international money transfers, which means more spending power for the recipients. In this article, you will be introduced to how you can use bitcoin to send and receive international remittances in Africa.
How to send or receive money with your Bitcoin wallet
To make a transaction in bitcoins, you need to have a bitcoin wallet. A bitcoin wallet is your digital wallet where you keep your bitcoin. In other words, a bitcoin wallet is like your bitcoin bank account. You can choose between mobile wallets, such as Luno, or use an online bitcoin wallet such as the one provided by Blockchain.info. Remember to use a strong password to ensure you bitcoins are safe. After buying bitcoin, the amount will be reflected in your bitcoin wallet. Then, you can send bitcoins to other bitcoin addresses through your wallet. However, purely sending bitcoin to someone in Africa won’t help them much. They will then need to transfer their bitcoins into local currency.
How to Change Bitcoin into Local Currency
If you want to send bitcoin to someone in Nigeria, South Africa or other countries in Africa, the simplest (and cheapest) way in most cases is to use the peer-to-peer exchange Local Bitcoins. Using LocalBitcoins you can exchange the bitcoins you have received into local currency through someone in your country on a peer-to-peer level. This can be done using bank transfers, mobile money or even cash depending on what both parties agree on.
In simple words, follow the procedure below.
- The sender buys bitcoin in their country
- Then the sender sends it to the African recipients LocalBitcoins account
- The recipient then exchanges the bitcoins for local currency on the LocalBitcoins exchange
Benefits of using Bitcoin to send money to Africa
In most cases, using bitcoin for private remittance purposes is cheaper than using established money transfer operators such as MoneyGram and Western Union. Bitcoin also allows anyone to send money without needing a bank account, which makes it a great tool for Africa’s unbanked population.