Remittance occupies an essential position in worldwide fund transfers. It is crucial for developing nations, often constituting a significant part of their economy and GDP. Traditional cross-border payment services are cumbersome and expensive due to several intermediaries slowing up the process and rising operational costs. HC Remit offers a viable solution that expedites the entire process at a fraction of the cost- with the power of blockchain.
HC Remit: Blockchain Architecture for the Perfect Venture
The blockchain-powered HC Remit platform offers an opportunity for banks, exchanges, and financial institutions to bypass traditional settlement routes like SWIFT or payment gateways- removing the intermediaries in between. This allows the platform to function with maximum cost efficiency while performing instantaneous verifiable transactions.
What is Remittance?
The word “remit” means to send back. Remittance payment usually refers to the act of sending back money to native families or acquaintances by expatriates working outside their homeland.
Globalization has led countless people to take up employment outside their homeland for better opportunities. Transfer of large capital amounts occurs through remittance on a global scale, generating a significant amount of revenue for conventional cross-border payment processing services.
The Global Remittance Market
Processing delays and high transaction fees in conventional payment processing services have attracted a large number of employees towards crypto-based remittance solutions. Banking solution providers often charge between 5% to 20% of transaction fees for each remittance. In the global scenario, remittance charges were 6.8% during the 3rd quarter of 2020, as per the World Bank. The charges surpass 10% instances where the recipient lives in Africa or an island state in the Pacific Ocean.
Worldwide remittance dipped 2.4% to $702 billion during the year 2020 owing to the global pandemic. India topped the list of recipient countries, followed by China, Mexico, the Philippines, Egypt, Pakistan, France, and Bangladesh. Of the aforementioned amount, estimates suggest $540 billion has been transferred to low and middle-income countries, making them the highest benefactors of remittance.
What Happens During an HC Remit Transaction?
Transactions in HC Remit bypass multiple steps when seen in comparison with conventional payment transfer methods. The product follows from an efficient algorithm supported by a high-level architecture to route the sender’s funds from a local bank into the recipient’s account overseas. The algorithm consists of the following steps:
The client application transmits a signal to the Business Adaptor, granting authority for collecting the fund specified and returning back to the app.
The Adaptor transmits the fetching data in 2 directions. It sends the particulars of the debited amount to the Blockchain Core. The data is broadcast over the entire blockchain network for permanent recording.
For the second direction, data is transferred to the Federation and Compliance Server. User credentials of the service provider are validated. The client also receives security tokens while the Compliance server verifies whether the action conforms with the policies and regulations within the country.
On passing verification, the funds are transferred to the beneficiary’s accounts overseas.
Features of HashCash HC Remit
Popular features of the HashCash’s HC Remit include:
- Real-time tracking of transactions through the Remittance Dashboard
- Options for fund monitoring and viewing NOSTRO accounts whenever necessary.
- Cross-border and cross-currency remittance options.
- Easy integration of banks or institutions within the existing network.
- Automation options for critical business operations through Smart Contracts
- Reduced cash expenses for pre-funded accounts with ad-hoc liquidity funding.
Blockchain technology revolutionized the world of finance by providing optimized payment processing solutions. HC Remit, a product of US-based blockchain developers HashCash Consultants, perfectly demonstrates this utility. Eliminating intermediaries accelerates the entire operation while reducing processing costs and boosting process security with blockchain. The financial product is ideal for banks, exchanges, and financial service providers.