One of the top three insurers in Japan, Sompo Holdings, Inc. has announced a business alliance with the leading digital foreign exchange platform and treasury solution based in Africa, BitPesa. This collaboration will allow Sompo to leverage BitPesa’s blockchain services to revolutionize the way businesses and individuals make financial transfers across borders. Both firms intend to help increase global trade and promote the digitization of international financial services.
As Sompo Holdings transitions into an era in which people, goods, data, and services move actively across national borders, international remittance and cross-border payments are playing an increasingly pivotal role in supporting these activities financially. However, expensive international remittance fees and lengthy processing times are serious challenges facing the market today. Resolving these obstacles and simplifying cross-border payments is expected to facilitate global trade and contribute to macroeconomic development.
BitPesa leverages blockchain settlement to significantly lower the cost and increase the speed of business payments to and from frontier markets, including international remittances across Africa and Europe. As BitPesa continues to open corridors for business payments and trade between frontier markets and the rest of the world, Sompo Holdings recognized a great opportunity in forming a business alliance with BitPesa.
While Sompo Holdings is currently engaged in efforts to resolve social issues by developing businesses that contribute to security, health, and wellbeing, the Japanese insurance giant was particularly impressed with BitPesa’s positioning with deep infrastructure across the continent to develop and distribute financial products.
BitPesa, which is rapidly scaling across a number of markets, including the entire African continent, Europe, and the Middle East, is expanding its customer base and service coverage. Together, Sompo Holdings and BitPesa believe that using virtual currencies will make it possible to resolve the problems of expensive exchange fees, while reducing long processing times.We focus on giving our customers the ability to transact between currencies. Now, we are welcoming other partners from around the world who want access to these markets. Sompo Holdings is one of the largest Japanese insurance companies and they are looking for new markets and new opportunities. We can give them immediate access to these markets. For all the financial services they offer, we can provide all the cross currency transactions to remove any currency risk, Elizabeth Rossiello, CEO and Founder of BitPesa told me.
In addition to a newly formed alliance, Sompo Holdings has also announced an investment in BitPesa. According to Rossiello, BitPesa will be using the investment from Sompo to deepen the firms infrastructure and roots within Africa and the Middle East. While the venture-backed firm has already raised $10 million from Greycroft Partners and others, having Sompo Holdings as a shareholder allows BitPesa to gain international credibility, geographical presence and customer reach.
“Any kind of transaction value for us is exciting because we have access and liquidity to all of these currencies and markets. Our number one goal is to increase liquidity in frontier market currency. It’s exciting for us If we can bring in partners that will eventually bring in flows for new currencies,” Rossiello said.
Together, Sompo Holdings and BitPesa will work to manifest a society in which goods and value can move back and forth frequently around the globe by harnessing virtual currency through a cost-effective and efficient digital platform. Ultimately, the firms plan to revolutionize the way businesses and individuals make financial transfers across borders.
Prior to Sompo Holding’s alliance with BitPesa, the firm announced a partnership with the Japanese money transfer giant, SBI Remit, to allow nearly half a million customers to send money to Africa using the Bitcoin Blockchain. Rather than relying on banks to move yen into U.S. dollars or euros and then into African currencies, BitPesa does this for SBI Remit using blockchain settlement services. The firm is also capable of settling remittances in as little as one hour. However, according to Rossiello, the alliance with Sompo Holdings is less about remittance and more about financial transactions.
“While we did something similar with SBI Remit, our alliance with Sompo is less about sending money to other people, and more about financial transactions and services and supply flows. SBI Remit focuses on small businesses and person-to-person transfers, while Sompo is disrupting financial services,” Rossiello explained.