The cross-border remittance market is a booming industry – currently valued at $24 trillion globally – and Align Commerce (AC) wants a slice of the pie.
Align Commerce has announced the first iteration of its payment platform which is based on decentralized ledger (blockchain) technology. The San Francisco startup was founded in 2014 by Marwan Forzley and Aldo Carrascoso. Forzley is a veteran of the online payment industry, who previously held a managerial position at Western Union and founded his own payment processing company (eBillme), which was later acquired by WU in 2011.
International payment networks such as SWIFT that currently facilitate currency transfers across the globe are very outdated, slow and opaque. Align believes it can offer a much more rapid and transparent solution for moving fiat currency around the world. AC’s platform uses Bitcoin’s blockchain to transfer value from one customer to another. Both sender and receiver are paid in fiat currency. International wire transfers can take up to several days to complete. On the other hand, transactions on the AC platform take only several hours. Not only is AC’s platform faster than traditional payment systems, but it is cheaper as well. Transactions that take place on the blockchain are publicly viewable, whereas wire transfers are not. When a business sends an international wire, there is currently no way to accurately estimate how long the transfer will take. This kind of uncertainty creates additional burdens on businesses that operate on tight deadlines. Currently, Align Commerce charges a 1.9% fee on foreign currency exchanges that is only levied on the party that is doing the conversion.
The Align Commerce platform allows users the ability to view the progress of their international transaction in real-time. This kind of transparency is not possible with the current international payment infrastructure. The AC platform is currently in beta, and only businesses from a select group of 22 countries are eligible to participate (United States, Spain, Austria, Belgium, China, Cyprus, Estonia, France, Germany, Greece, Hong Kong, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Philippines, Portugal, Slovakia, Slovenia).
Bitcoin companies are currently not regulated yet in the US. This loose regulatory environment provides a very cost-effective environment for new startups. Established remittance services such as Western Union have sizeable regulatory and compliance costs that are passed on to consumers in the form of higher fees. Blockchain-based payment systems such as the one provided by Align have the potential to greatly disrupt the established cross-border payment networks such as WU and SWIFT.
Image Source: https://aligncommerce.com/