Most people who have been active in the Bitcoin world for a while now will remember a company called BitPesa. Similar to how M-Pesa offers remittance services to Kenyans, BitPesa would do the same but based entirely on Bitcoin. Unfortunately, BitPesa never made as big of a splash as the company would have wanted, but Bitcoin’s story in the Kenyan remittance business is far from over.
Bringing Bitcoin to M-Pesa Services
There is no denying that mobile payment solutions are gaining more and more traction in countries where financial services are all but non-existent. Kenya is one of the prime examples of why remittance services are doing so well in that part of the world. Giving people the option of transferring fiat currency through feature phones is a major step forward for the local economy.
After tinkering around with the M-Pesa service for a while, Michael Bumann managed to crack the code to introduce Bitcoin to this fiat-dominated ecosystem. All it took was a few open source tools combined into a bot, sending Bitcoin through a messenger to deposit fiat currency into an M-Pesa account, and it all becomes possible.
Facilitating this project came in the form of using WhatsApp and Telegram, both of which are open source messenger applications for feature phones. Taking a close look at both programs’ interfaces gave Bumann the idea and concept he needed to create his own Bitcoin-to-M-Pesa bot.
It is important to keep in mind this Bitcoin-to-M-Pesa Bot is just a prototype and needs a fair amount of fine-tuning before it will be released to the general public. Other than just using it to pay for services, this bot can effectively be used to pay for goods and services in the entire city of Nairobi, Kenya.
What makes this bot so unique is how the entire process can be executed by using social messaging applications most people are already accustomed to. Creating entirely new platforms is not a viable option to improve widespread Bitcoin adoption. Everyday consumers will not install a brand new application for a feature they may never end up using.
Mobile payments are booming all over the world and developing countries are a proving ground for bringing financial services to consumers with access to feature phones. M-Pesa was one of the very first to crack that code, but that doesn’t mean their service is perfect, however. That being said, this platform gives residents the option to pay for just about anything with their mobile device, a feature many people in the Western world would love to have at their disposal.
Facing Legal Issues When Making The Bot Public
One of the main reasons for not making this Bitcoin-to-M-Pesa bot public just yet is due to potential legal issues when doing so. Launching this tool would require approval from the telcos and M-Pesa, as well as specific licenses issued by the Kenyan government. Obtaining these things will take up valuable time and is not something Bumann is looking to do anytime soon.
Furthermore, this bot can be subject to additional scrutiny, as the entire process is not tied to any particular African Bitcoin exchanges either. Allowing cross-border transactions through foreign exchanges is a grey area at best and will be frowned upon by government officials.
Images courtesy of M-Pesa, Shutterstock