The world is awash in unused mobile phone minutes.
Billions of people buy them every day to replenish their phones. The minutes
facilitate communication between people and businesses. They also, in less
developed communities, are informally used for financial transactions. BitMinutes
(BMTs), which can be converted to mobile phone minutes on a wide range of carriers
and used as a store of value for making payments, is formalizing that process
and broadening the scope.
First, there are billions of underbanked people
in the world who don’t have access to traditional financial services.
“Today, there are more than two billion
adults who are underbanked,” said BitMinutes CEO Tom Meredith. “That means they
don’t have the ability to conduct financial transactions. In developing
countries, the situation is especially dire, with more than 40 percent not
having a bank account. Most of these underbanked people rely on cash and
bartering to conduct business. This makes it very hard to expand a promising local
economic initiative or new enterprise.”
Second, mobile phone minutes have
limitations when it comes to their use as a store of value for financial
transactions. For example:
The owner of the minutes can only
give them to people on the same network – it’s completely siloed.
Once the airtime is purchased, it
cannot not be converted back into cash. The only use for it is to make a phone
This informal currency needed a vehicle for
breaking these two walls down. Enter the BitMinute (BMT). Built with the
distributed-ledger advantages of blockchain technology, the BitMinute does a
number of things to turn the mobile phone minute into a more useful asset.
BMTs are tradeable between networks. A
person buying BMTs to use on Vodaphone in one country, can send those BMTs to
an Etisalat customer across an international border. Through a Trusted Agent
operating in a local distributor’s storefront, the BMTs
could then be turned into cash again.
“As BMTs become more widely bought, owned
and traded, they may start to replace the network-specific mobile phone minutes
sold by mobile operators,” said Meredith. “Breaking the constraints on the free
flow of mobile phone minutes between any two phones across the globe is the
BitMinutes’ mission. We see our work as part of the global war on poverty, with
our role one of removing barriers to entrepreneurial opportunities and
fostering greater financial inclusion in underserved communities everywhere.
And this isn’t a grant or charity. This has to be self-sustaining. Which means
there has to be a way for everyone involve to make a little money, just as
happened with M-Pesa in Kenya.”
The “entrepreneurial opportunities” that Meredith speaks of are created in two
ways. First, BitMinutes enhances the free flow of working capital to the underbanked,
who are enabled to start their own businesses. Second, the company has created Trusted
Agent Network by working with local retailers, distributors and even financial
institutions. These agents, once trained by BitMinutes, bring the transparency
and confidence needed to draw more informal economic activity into the formal
“Small businesses can make money using BMTs
in different ways,” said Meredith. “They can sell BMTs just like the regular
prepaid minutes they already sell. And they will soon be able to lend BMTs as
an asset-backed token, using a BMT balance as collateral for a microloan.”
“This is the beauty of our network-based
financial services distribution system. The local retailer does not have to
change behavior dramatically to become a TAN Agent and start offering services.
And by having the ‘bank branch’ infrastructure in the cloud, securely accessed
by the smartphone in the agent’s hand, network expansion is simplified and our
ability to expand accelerates.”
Hundreds of agents are already up and running in Nigeria, facilitating the
sale of millions of BMTs, a quantifiable harbinger of things to come.
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