El Salvador’s largest banking institution Bancoagrícola will work with Flexa to accept Bitcoin across the bank’s network for payments like loans and credit cards. The country’s Bitcoin adoption journey seems to be smooth sailing.
Following its cooperation with digital payments gateway Flexa, El Salvador’s largest banking institution, Bancoagrcola, is aiming to increase the country’s Bitcoin adoption policy.
Bancoagrcola has signed a deal with the crypto payment network Flexa to facilitate Bitcoin (BTC) transactions for the bank’s customers, including retail and merchant clients, according to an announcement made by Flexa on Thursday.
Bancoagrcola users can use Flexa or other Lightning Network-enabled wallets like Chivo and Éclair to make credit card payments in US dollars as part of the cooperation.
According to the press release, these payments will not incur any additional costs and will cover a variety of items including loans and merchant goods.
Flexa just launched Lightning payment functionality, which is purportedly targeted towards merchant clients.
The announcement of Bancoagrcola’s relationship with Flexa comes on the heels of El Salvador’s adoption of Bitcoin as legal cash.
On social media, reports of El Salvadorian merchants taking Bitcoin are becoming more widespread, with Cointelegraph stating that McDonald’s outlets in the country are now accepting BTC as payment.
According to El Salvador’s president, global money service companies like MoneyGram and Western Union might lose up to $400 million per year if the country’s Bitcoin adoption program is successful.
Indeed, remittances account for a large amount of El Salvador’s GDP – 23 percent in 2020 alone — and 70 percent of the population is said to get money from abroad.
The Central American Bank for Economic Integration, or CABEI, indicated in August that using Bitcoin as legal cash might have a favourable influence on regional remittances.
The CABEI promised at the time that it would help the government develop a technological framework for BTC adoption as well as ensure compliance with international anti-money laundering requirements.
El Salvador’s Bitcoin Law is not without criticism, with reports claiming that the majority of the country’s populace opposes the move.
The International Monetary Fund and other global financial institutions have also warned against adopting Bitcoin as a national currency.