Following its collaboration with digital payments platform Flexa, El Salvador’s biggest financial organization, Bancoagrcola, is poised to expand the country’s Bitcoin usage guideline.
Flexa said on Thursday that Bancoagrcola has signed an agreement with the cryptocurrency payment platform to allow Bitcoin (BTC) transactions for the bank’s clients, comprising retail and merchant clientele.
Customers of Bancoagrcola may now settle credit card dues in US dollars using Flexa or even other Lightning Network-supporting wallets such as Chivo and Éclair as portion of the collaboration.
As per the announcement, these payments would not be subject to any extra costs and will encompass a variety of items, including loans and merchant products.
Flexa has introduced Lightning payment functionality, which is apparently targeted at merchant customers. The collaboration between Bancoagrcola and Flexa comes in the wake of Bitcoin becoming national tender in El Salvador. News of El Salvadorian businesses taking Bitcoin are becoming more frequent on social networks, with Cointelegraph claiming that McDonald’s branches accept BTC as mode of payment.
As per the country’s president, if El Salvador’s Bitcoin adoption strategy is effective, global money transfer companies such as MoneyGram and Western Union may run the risk of losing a maximum of $400 million each year. Indeed, remittances make for a substantial part of El Salvador’s GDP – 23% last year alone — with 70% of the population getting money from abroad.
The Central American Bank for Economic Integration (CABEI), said in August that using Bitcoin as legal currency may have a beneficial effect on remittances in the area.During the period, the CABEI pledged to help the government create a technological backbone for BTC adoption while still adhering to international anti-money laundering requirements.
El Salvador’s Bitcoin Law wasn’t without controversy, with the overwhelming percentage of the country’s people allegedly opposing the initiative. The International Monetary Fund and other global financial institutions have also cautioned against embracing Bitcoin as a legal tender.
