Most of the money exists in electronic form, in bank accounts as zeroes and ones, only a small percentage is in cash. One would suppose that consequently financial flows should be fast, considering the speed with which money orders travel within the network.
And yet it is not unusual that an old-fashioned package sent by mail from Ljubljana to Istanbul reaches the recipient sooner than money from a Slovenian bank account is transferred to Turkey. The delay could be caused by the international payment system Swift in charge of inter-bank financial communication, different working hours, several identity verification checks for money laundering prevention … and related costs.
Two Slovenians, Tim Mitja Žagar and Jani Valjavec, claim to have found the manner to reduce costs of international money orders, and increase the speed of transactions. They see the solution in the digital cryptocurrency Bitcoin. How? Instead of transferring euros, dollars and other currencies through bank systems, bitcoins are sent; transfer is even easier if there are company subsidiaries in other countries.
The service is still being developed, but at the moment their company Cashila is the only company in the world with the licence for performing bank transaction through bitcoins within the SEPA territory. The licence was issued by the Check National Bank for 28 EU countries, and for Iceland, Lichtenstein, Norway, Switzerland, Monaco and San Marino.
What are the services Cashila is promising? Janez Novak registers his user account, by which a number of possibilities are on his disposal, the founders of the company explained for MMC. Novak could be a self-employed entrepreneur performing services for clients outside the European Union. A payer from the USA can change the due sum from dollars into bitcoins at the local stock exchange, and transfer them to the Cashila account, more precisely to the Novak's box at Cashila. The transfer is done almost instantaneously, and the company charges one-percent provision for all receipts (and no provision for expenditures).
The service is very useful for the citizens of third countries outside Europe who work for European companies and would like to receive their earnings as soon as possible. A client thus transfers a salary to the user's address at Cashila, which allows the receiver to exchange bitcoins for the local currency in his country. Cashila charges one percent, while other systems for international money orders cost much more, the company claims.