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Bitcoins have major potential in Africa, changing banking industry

There is huge potential for bitcoins to shake up the financial industry in Africa, but plenty of problems lie ahead
By: Michael Hatamoto | Business, Financial & Legal News | Posted: Feb 22, 2015 5:15 pm

The bitcoin cryptocurrency is struggling in the United States and other developed nations, but could have a major impact in sub-Saharan Africa. Around 75 percent of the population don't have a traditional bank account, and while more users rely on mobile phones to make transactions, it can be a slow and expensive process.




There were up to $1.8 billion in remittance fees, with a traditional money transfer charging a 12 percent transfer fee. Embracing bitcoins would help speed up the process, so money arrives to the recipient faster, while also being much cheaper.


"Bitcoin can greatly alter the remittances industry and beyond," said Michael Kimani, head of the African Digital Currency Association, in a statement to CNN. "From seven days [for a transaction to clear] using banks and PayPal, down to 20 minutes speaks volumes."


Kimani has met with multiple bitcoin supporters and companies, in an effort to be a pioneer in a payment industry that could do with a drastic modernization.


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