Heaptalk, Jakarta – Currency and payments have already been converted to digital formats. Customers can select from various digital payment instruments when making purchases from merchants, including credit cards, app-based payments, and via the internet options. Recently, blockchain technology has been integrated into the payment system, allowing consumers to conduct transactions without incurring additional charges, particularly when transacting between nations (cross-border transactions).
Going back a few years, there was no mechanism to handle interbank transactions, causing a pain point for the customer by levying additional costs. When they want to conduct cross-border transactions with their relatives, they must pay a higher fee. This is the manifestation of how Anish Jain, the CEO of WadzPay build a company that is involved in the payment integration backing with Blockchain as a core technology. The Singapore-based company brings the concept of Central Bank Digital Currency (CBDC) – not only giving consumers and regular businesses access to electronic central bank money, but also allowing for safer payments.
Anish Jain, ex VP of MasterCard Market, compared up to ten years ago, where the industry get started to has a myriad of requirements for making transactions via multi payments. Through his acknowledges, he saw the opportunity significance of this emerging CBDC concept, which would make it simpler for institutions to conduct multi-payment transactions as well as cross-border payments —with crypto-based transaction model brings value that the transactions are unaffected by external fees. In fact, today’s standard wire transfers and foreign purchases typically involve fees and exchange costs.
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The most common examples can be seen by the cryptocurrency transactions like Bitcoin and Etherium do not involve any intermediary institutions or governments. It then makes the costs of transacting are typically lower than those associated with bank transfers. WadzPay’s goal is to connect this technology to the existing payment ecosystem on the front end.
Prior to this, Anish also intends to present this approach in a CBDC with WadzPay, as he believes that there is currently no sophisticated approach that accommodates payments at the intermittent level, such as transacting from a Singapore bank to a Middle Eastern bank. If there is, he believes that numerous solution models need to be revamped.
“The blockchain enables transactions to become more rapid. removing the inconvenient wait times and authorization requirements associated with traditional authorization processes. This technology is mature enough and ready in the mainstream environment. However, we must provide the appropriate solution that is aligned with the current industry and results in a slew of new disruptive technologies. However, the fundamental question remains: Is blockchain mature enough? We must respond that it did indeed emerge that much “Anish Jain stated.
Targetting the B2B Market
Wadzpay, which was founded in Singapore in 2018, now primarily serves Asia and the Pacific region and has had rapid growth. According to Anish, they have just established a new regional headquarters in Dubai, which will supervise activities in Dubai and Africa, and they are looking to expand into Europe bringing the current business model that is mostly focused on B2B enterprises, namely the banking industry.
Even though they are presently in sandboxes and pilots in various countries, Anish has also said that his pipelines will add value to the banking sector by demonstrating how the blockchain-based payment system enables smooth cross-bank transaction transmission. The impact will be felt on banking operations and financial organizations such as alert providers, super apps, and hyper apps, as well as the supply of digital assets for trade on an exchange market.
“It is mostly up to the bank, the electronic bank, wallet owner, or custodial service provider to provide that payment or option to consumers, clients, businesses, and etc, through the CBDC as the future of Banking payments,” said Anish.
The Philippines is a demographic market that is prepared to embrace the CBDC concept. According to Anish, WadzPay has created several large partnerships in the country as a result of the country’s large population that works outside the country, and remittances are facilitated through the corridors. Additionally, Anish added that WadzPay is affiliated with a digital banking aggregator to which the Philippines, as well as the Middle East and Africa, are members.
“WadzPay is keen to build a relationship with worldwide connection, as we also have a cooperation with one of the world’s major acquirers, one of the world’s two largest quarters, with whom we will facilitate the worldwide acceptance of digital assets,” Said Anish.
Anish realizes the new concept of blockchain by bringing simplicity to the society (the unbanked/underbanked) that does not currently have access to banking themselves into the financial ecosystem using Blockchain, and then uses those examples to change or affect the traditional payment ecosystem. It accomplishes this by bringing the unbanked population into the mainstream, which is still reliant on legacy systems, through hybrid solutions, similar to what is happening with electric cars. Many of the first blockchain use cases are from the consumer’s point of view. Imagine if all of the blockchain features could be embedded in smart money, allowing smart contracts to be built into smart money, resulting in a plethora of potential social goods. Another application is for disaster relief funds: Blockchain enables a tailored offering with rapid cash-less relief and the ability to ensure that relief funding is directed to the right people and for the right purposes.
The benefits behind the CBDC implementation
According to Anish, CBDC will still benefit people for improvements in welfare distribution, loan disbursements, and security. Governments and central banks favour CBDCs due to their benefits, convenience, cost-savings and also surveillance. However, many sections of the general public will still prefer alternative solutions.
Speaking behind the benefits, Anish divides the process into three levels. The first step is for the bank to be able to offer the same capabilities as digital assets. Whereas most common knowledge is that these digital assets are usually stored in exchanges, WadzPay focuses more on acquiring the bank that is purely consumer-based and trustworthy at the entry-level. The money in the transaction is not in the hands of private operators, but rather of a regulatory entity.
“So we work closely with the government and the banks. We are pro banks and we are pro-regulation, wherein we allow these banks to now start providing these services to its consumer base,” Said Anish.
Following that, why does the idea appear to have enabled or paved the way for CBDC, given that customers frequently use their balance to purchase something? It’s similar to a typical customer journey, where WadzPay wants to adopt the customer in the same way they do when they make a purchase with their wallet. Dan Around $1 billion of regional spending has been made through the use of digital assets.
WadzPay is establishing a network with large corporations such as MasterCard and Visa, which means they are beginning to accept digital asset transactions, such as those involving the crypto currencies USDT and USDC.
“As a result, we’re collaborating with them to enable these merchants. Thus, we are not launching a new app or releasing anything; rather, we are connecting existing ecosystems and making them smarter,” said Anish.
Then there’s remittance, the third line WadzPay business. They call it as ready remittance 3.0. Most importantly, the problem with remittances has been that it is inherently unfair to people who need them the most. Thus, those who work outside the home and earn daily wages are the ones who send money back, but the poor are the ones who bear the brunt of remittance fees.
As a result, WadzPay want to make things right. That should not be the case; if someone has abandoned his family, if he is a blue-collar worker working outside of India, and if there are so many different Indonesian Filipinos, they should not be required to pay high Western Union fees, etc.
And it is in this context that WadzPay are attempting to build an ecosystem in which, without giving too much away, it hopes to attract several players with liquidity in the digital asset space to begin bidding for that business.
As a result, for a foreign worker or working abroad and who want to send money home, they will now have the option, within the same application, the banking app, of selecting between three distinct providers. They also can compete based on delivery speed, membership points, or other metrics.
“As a result, from these three parameters that we allow or include in the ecosystem, people can now start creating records of benefits based on those three parameters to improve their financial experience,” conclude Anish.