By George Ward
Stellar, a P2P decentralized platform, has signed a new partnership deal with Fonbnk. Fonbnk wants to use Stellar’s blockchain network to turn SIMs into virtual debit cards.
Additionally, airtime loaded on these SIMs is tokenized into MIN. Afterwards, the technology will transform the MIN into a USD Coin.
Fonbnk To Offer Financial On-Ramps In Cash Economies
Fonbnk, a finance company, wants to offer financial on-ramps in cash-centered economies, especially in Africa. According to statistics, over 350 million Africans do not have bank accounts.
A Fonbnk study revealed that 64% of Sub-Saharan Africans have smartphone access. However, most users have pre-paid SIM cards for which they buy data and airtime.
Fonbnk believes individuals can easily access airtime compared to cash and other forms of money. So the company is looking at using airtime to trade for other services and goods.
However, airtime is vulnerable to price fluctuation by cell operators. This is because of Africa’s lack of stable infrastructure,
Therefore, Fonbnk intends to fix the problem by converting active pre-paid SIM cards to digital debit cards. These debit cards would operate on the Stellar network.
Meanwhile, Fonbnk claims it can accomplish this for the 8 billion people across the globe. Chris Duffus, the founder, and CEO of Fonbnk commented:
“The most significant barrier in our target sectors is not always self-custody. Individuals are price-sensitive when it comes to airtime costs. Hence, we target how to move money around and transaction costs. Stellar has been a wonderful partner since the inception of this idea.”
According to Fonbnk, airtime has the same value and usefulness as currency for Africans. As a result, it is building a blockchain-fueled marketplace in collaboration with Stellar.
This marketplace will transform airtime into virtual cash and vice versa. Hence, individuals and organizations will begin seeing airtime’s transactive value.
Fonbnk To Convert Credit Into USD Coin
Additionally, Fonbnk claims that 1.4 billion individuals worldwide can access markets and financial services previously out of reach by utilizing its wallet. All users have to do is load their pre-paid airtime credits into their Fonbnk wallet.
“Those credits will be ramped into the Stellar blockchain, digitized into tokens and dubbed MIN, which can subsequently be converted into USD Coin,” Fonbnk explains.
The transformations will take place almost immediately and at a low cost. Furthermore, users could use these USDCs to buy items and services that are not commonly available in their home countries.
Fonbnk added that customers could purchase MIN using credit, debit, or cryptocurrency. They can also transfer MIN to their friends and family.
Duffus noted that this is a chance for the company to use its technology. He believed that such a payment system would make a significant difference and assist the next generation in embracing the digital world.