(Discount for LTP subscribers inside the article)
Both blockchain and bitcoin have been a trending topic at Let’s Talk Payments, especially when it has to do something with payments. We happened to come across CoinPip, a Singapore-based international remittance company at TechCrunch Disrupt 2015 in San Francisco and we kept following the company thereafter. Since blockchain is a hot topic and international remittance is a growing industry, we had an opportunity the discuss the same with the CEO of CoinPip, Anson Zeall.
CoinPip, a 500 Startups-backed company, allows businesses and individuals to transfer money at a low cost by using bitcoin in the back-end. CoinPip's vision is to connect the world with blockchain technology. The company offers a friendly and fast international money transfer service that businesses can use to send money to partners and remote workers that are in Indonesia, China, Taiwan, Hong Kong, Singapore, India and the Philippines with just a 2% flat fee. Based in Singapore, the CoinPip team has worked on high-tech projects across the globe. Here’s what Anson had to say about CoinPip and his views on the industry:
1. For LTP readers who might not be familiar with CoinPip, can you please tell us about CoinPip and how it is making international remittance easier?
CoinPip (500S Batch 11) is a blockchain-based, end-to-end money transfer service for startups and small businesses. This means that instead of using SWIFT and bank wires to transfer money, we help customers transfer their funds via various blockchains. Users don’t need to understand the technology behind it; they simply make a local bank deposit to a designated account and we do the rest.
2. Since you have now launched in Singapore, how does the international remittance market look like in Southeast Asia?
FinTech is definitely heating up in Southeast Asia and most member governments in ASEAN (Association of Southeast Asian Nations) are open to it. Remittances are used heavily in this region as many overseas workers (beyond ASEAN) send money to ASEAN, be it sending money home, or sending funds to outsourced workers.
In Singapore’s case, the Central Bank in Singapore, known as MAS (Monetary Authority of Singapore), has set up a FinTech and Innovation Group, and one of their first moves will be to invest the $225M that they announced recently.
3. CoinPip uses the blockchain technology for international remittance. How does this work in the back-end? Many people are still not aware of how you can use blockchain for remittances. Can you shed some light on this technology?
Recently, some companies have complained that using a bitcoin blockchain as a rail to transfer is expensive. But like Wallace Wattles of the "Science of Getting Rich" said, "Those who do things in this certain way, whether on purpose or accidentally, get rich. Those who do not do things in this certain way, no matter how hard they work or how able they are, remain poor." To tie this idea back into what I was saying earlier, there is a certain way of executing these transactions via the blockchain that makes fund transfers considerably cheaper than bank wire transfers.
Explaining how blockchain works to people is like explaining how the Internet or electricity works. I don't think many people actually understand how SWIFT or bank wires work. Equally, people don't need to understand the technology behind blockchain, they just need to know that we can guarantee faster and cheaper transfers.
4. How are you different compared to your competitors? What are the main reasons a business would choose CoinPip to pay their contractor?
CoinPip is based in Singapore for a reason. We are close to the people that need our services the most. We also know the needs of startups in the valley (through our experience at 500 Startups). We have a clear picture of what the developed and developing markets need.
5. Can you briefly tell our readers about your best customer story?
Voyagin, a subsidiary of Rakuten, is one of our biggest customers. They use our services to send money to their contractors in Indonesia and Hong Kong. For those not familiar with the company, Rakuten is the largest e-commerce company in Japan.
The best story to date was when Voyagin's executives needed to pay a hotel partner in Indonesia immediately, otherwise Voyagin's guests would not be welcomed at the hotel. CoinPip was able to immediately execute a transaction for Voyagin, which was received by the hotel partner's bank account on the same day.
6. What are some future business plans at CoinPip? Are you also positioning CoinPip for B2C use? If not, do you plan to do so?
Yes, we are looking at B2C. The reason we're servicing B2B first is because those were the customers that first approached us in March when we launched at SXSW. I'm a lean startup guy, so I do things according to what my customers want. And regulation-wise, it's much easier handling B2B customers as companies are willing to comply with our compliance policies to a much greater extent compared to working with consumers. But CoinPip now has a team of great investors and advisors, spanning financial experiences from PayPal, Standard Chartered, VISA, DBS (Development Bank of Singapore) and Bank of America. We'll be pushing into the B2C segment soon. I can’t give you a launch date yet.
7. What do you think is the future of blockchain and international remittances in general? How big is the industry? What are some trends that we should look out for?
There’s going to be a change in how foreign exchanges are traded, how transfers are made, and ultimately, there will be more accountability from all parties to reduce fraud.
The industry is still very small. And sometimes, numbers don't give the full story. If you asked lay people three years ago what bitcoin was, they would’ve had no idea. If you ask them now, they’ve at least heard of it. Prices of bitcoin haven't changed much over that period, but transaction numbers have increased. These transactions don't only include people using bitcoin as a currency, but for other means as well. This is the same in our case; we are contributing to the transaction numbers of various blockchains, but our business is not about using the "coins" as currency.
There's been a backlash recently around bitcoin startups where startups are pivoting away from their initial vision. Although people might see this as a bad thing, I see it as a good thing. Ultimately, both the entrepreneurs and VCs want to earn money from the startup and investments respectively. A change happens because the previous product iteration did not make money. If the pivot happens and the startup can scale its revenue, then it's a good thing for everyone. Coming from a lean startup background, it’s all about customers-first, not vision-first.
What to look out for? Non-transactional uses of blockchain. That will be next big thing. For example, finance, payments, digital signatures are all transaction-based. If you treat blockchain as a non-hackable cloud storage, there’s actually a lot of things you could do with it.
LTP is great! I hope to see LTP expand into Southeast Asia soon! The LTP family will have access to our premier customer plan. That means all transactions will incur a 1% transaction fee only. There will be no minimums and no forex. Ex: you could even transfer $20 USD, and we'd only charge 20c.