ZipZap and Rebit Team Up on the $2 Billion Canada-Philippines Remittance Corridor

The Philippine’s oldest rebittance service, Rebit.ph, the flagship service of Satoshi Citadel Industries, recently announced a partnership with mobile money transfer app ZipZap, in order “to tackle the $2 billion Canada-to-Philippines remittance corridor with blockchain technology.”

ZipZap is a technology platform for moving money around the world via a smartphone app. The San Francisco-based company successfully raised US$2.2m in VC funding last year, to bring significant innovations to the remittance industry “by leveraging mobile technologies, digital payment solutions and traditional payment rails.”

“This partnership … will allow Filipinos in Canada to use the ZipZap mobile app, connect it their bank account, and conveniently send money back to the Philippines using their smartphones without having to know anything about Bitcoin as a transfer mechanism.”
— – Rebit.ph

Before Rebit came along, ZipZap used the Interac network to wire funds to banks in the Philippines, with a wait of 1 to 2 days. Funds can now be moved over the Bitcoin network, so transfer speed depends primarily on Rebit’s internal processing.

“By leveraging Rebit’s expertise on Bitcoin-powered remittances, the ZipZap mobile app will allow overseas Filipino workers to save time, effort, and a significant amount in fees as compared to traditional money transfer services.”
— – Rebit.ph

By partnering with ZipZap a huge remittance market has opened up for Rebit.ph, Canada accounts for approximately 7% of the Philippines’ total remittance industry. Currently, only a small percentage of remittances from Canada to the Philippines is via bitcoin.

Rebit.ph’s mission is to further the growth of the Bitcoin network in the Philippines, which is the third largest recipient for remittances in Asia, with US$28.4 billion transferred, behind only India (US$70.39 billion) and China (US$64.14 billion), according to the World Bank’s remittance data.

“The lion’s share of these remittances are enabled by conventional banks and money transfer agents, which charge hefty fees for international transactions. Rebit aims to provide a comparable service at a significantly lower rate by leveraging the superior process that the Bitcoin platform enables.”
— – Rebit.ph

According to a June 2015 report by the World Bank Group, the average global cost of sending remittances has been slowly declining, and is currently at 7.68%, based on statistics from 227 major international remittance corridors.

The report also finds that the average cost of sending money from Japan, Germany and Canada are above the Global Average, with Japan being the most expensive and Russia being the cheapest.

The average remittance cost for the Canada-Philippines corridor is lower than it is for many other countries, standing at 6.04 percent for remitting CA$200 through banks. The remittance costs are correlated with the level of competition in the remittance market, and the size of the market, with banks charging the most while money transfer operators charging less, at 4.51 percent.

However, it is still much higher than other corridors such. The United Arab Emirates–Philippines corridor averages only 3.27 percent. By comparison, remittances for the Canada-Rwanda corridor costs approximately 9.13 percent.

Meanwhile, the remittance market has been growing steadily in the Philippines. The World Bank’s Bilateral Remittance Matrix 2014, combined with annual remittances data, shows that monthly remittances inflows into the Philippines exceeded the $2 billion level in October 2011 and, for the most part, have remained above that level. Remittance inflows into the Philippines have been growing at an average annual rate of 7.31%, from 2010 to 2014, and reached an all-time high of US$28.4b in 2014.

Among the largest markets sending remittance to the Philippines, Canada ranks fourth with the remittance outflow of US$2.075b into the Philippines, out of the country’s total outflow of US$23.15b. According to the World Bank’s 2014 Bilateral Remittance Matrix data, only three countries remit more money to the Philippines, the United States, United Arab Emirates, and Saudi Arabia.

Even though money transfer operators charge smaller fees for remittances than banks, Rebit.ph claims to have even lower fees. Before the partnership with ZipZap, anyone wanting to use Rebit.ph to send money to the Philippines from Canada would have to know how to use bitcoin to transfer funds. However, with ZipZap in the process, remittances can be done using bitcoin as a transfer system, and the platform provides a user friendly fiat format..

With ZipZap’s free Android app, you can send as little as US$25 but there is a maximum of US$995 per day and US$3,000 per month. ZipZap takes a small percentage when converting money, and there are no additional fees charged to the sender or recipient.

“We’re utilizing new technologies to transfer money from Canada to Philippines in lightning speed!”
— – ZipZap

“We believe this partnership is a perfect example of how Blockchain Technology can be used beneficially without any risks to the end user, who in this case are our fellow Filipinos in Canada. ZipZap provides a great service that we believe will greatly benefit our service and vice-versa,” said John Bailon, CEO of Satoshi Citadel Industries, expressing his excitement to be working with the ZipZap team.

This partnership will open up a new market for both ZipZap and Rebit.ph, allowing both companies to attract more customers for a low cost, lightning speed remittance service. At the same time, the deal will demonstrate further how a bitcoin company can partner with a non-bitcoin company to create a win-win situation.