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Stellar partners use USDC to transfer funds between Europe and Africa.
The Stellar Development Foundation (SDF) has announced that it will create a new money transfer channel between Europe and Africa, and will do so using USD-based stablecoin (USDC).
On October 25, SDF announced that global payment technology company Flutterwave will use USD Coin (USDC) stablecoin on the Stellar network to simplify money transfers between Africa and Europe. Flutterwave will work with Stellar's main EU payment partner, Paris-based remittance operator, Tempo Payments.
Olugbenga Agboola, CEO of Flutterwave, commented on the matter saying that sending money to sub-Saharan Africa is now more expensive than to any other region in the world. He added that the new partnership will help expand the network and "will provide the most important - cost effective remittance service for African business owners."
Flutterwave says it has processed more than 140 million transactions worth more than $ 9 billion to date, serving more than 290,000 companies, including Uber, Booking.com and Facebook. The company already has infrastructure in over 33 African countries, including Nigeria, Rwanda, Uganda, Kenya and South Africa.
SDF has been serving Africa for about a year and the foundation teamed up with the East African payment company ClickPesa in November 2020. ClickPesa provides payment systems and access to banking systems in Tanzania, Kenya and Rwanda.
However, Stellar and its partners face stiff competition as several payment companies already operate in Africa, including WorldRemit, Azimo, Transferwise, Payoneer and Xoom.
Africa has become a key market for payment firms as much of the continent's population is left without banking. However, remittance values ??fell during the pandemic-induced lockdowns, and Africa.com recently reported a 28% drop in remittances to Nigeria last year.
It is also projected that by 2025 more transfers will be made in cryptocurrencies rather than dollars. Digital assets are likely to penetrate the African remittance market, despite the policy of their exclusion from local governments.
