'Cash deposit' Method For Buying Bitcoins Reaches India
Bitcoin exchanges have found the magic formula that allows funds to flow and a new exchange, Mr. Bitcoins, is taking it to India!
For the first time ever for the country, those wishing to buy bitcoins can simply bring their Rupees to a bank (HDFC) and make a deposit into a special account for the exchange. Those funds are then converted to bitcoins and the digital currency is delivered to the Bitcoin address the customer specified.
Mr. Bitcoins launched in May and offers this cash deposit method in Australia and the United States as well. The exchange is operated by Kenseycol PTY LTD out of Australia.
This method will likely be valuable for its convenience — funds from cash deposits are converted either the same day or next business day.
The exchange rate that is quoted is real-time but it is somewhat higher than the BTC/USD exchange rate after further converting it using the USD/INR conversion rate. There are no additional fees however, causing this method to be cheaper than sending an international bank wire or other money transfer service such as Western Union.
Update: We’ve been asked to explain in more detail how to use this service:
- Visit Mr. Bitcoins, click on the INR tab.
- Enter your e-mail address, your bitcoin address (e.g., from Instawallet), and the amount (in BTCs) that you wish to buy. Then click the Buy Bitcoins button.
- You will then see a receipt with the HDFC account name, account number and the amount (in INRs) to deposit.
- Print the receipt and take it with you to the nearest HDFC where you deposit cash into the account shown on the receipt. Once Mr. Bitcoins sends the bitcoins, you can monitor the transaction’s progress towards getting confirmed using Blockchain.info.
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Why has Bitcoin so far gotten zero traction in India?
Forum user minorman on BitcoinTalk.org describes in a post a number of attributes that would indicate Bitcoin should be starting to gain a little interest in India but to-date, so little progress has been made.
minorman writes in support of the open question:
- India has more programmers/computer people than the rest of the world combined.
- People in India love tangible assets (gold/silver)
- The Rupee is crashing and the gold price has just hit an all time high in Rupees.
- 108 people in India have no bank account or otherwise access to financial services.
- Millions of Indians live outside India and send money to/from relatives in India.
- Unlike China, India has no “great firewall”.
The forum board has a restriction the limits new users to a specific newbie forum as an approach to limit posting of duplicate questions and to bring trolling to manage levels on the other boards once a new user “graduates” (or gets whitelisted) out of the newbie forum. This is an unfortunate hurdle that the moderators felt needed to be put in place but the equivalent of “forum vandilism” that had been occurring had made the boards unusable for everyone without this restriction.
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Paxum: EFT Withdrawal To Mexico, India, Turkey, UAE & More
bitcoin:
Paxum (@PaxumInc) has introduced electronic funds transfer (EFT) for customers in nearly two dozen countries. For the first time those holding bitcoins in those countries can now use an exchange to move funds to Paxum (directly with Mt. Gox, Intersango and TradeHill or indirectly through the use of BitInstant) and from there withdraw as an electronic bank transfer.
Paxum does require the customer to first prove identity during the set up of the customer account (with two forms of photo identification required for customers in areas considered risky) however subsequent transactions will occur in a more timely manner.
The Canadian registered money service business been offering global money transfer and merchant payment services since 2007. Paxum is among the financial organizations whose service offerings mesh relatively well with the needs of Bitcoiners. This new EFT offering is the first such electronic link between Bitcoin and the banking systems in many nations. The full list of countries where Paxum funds may be withdrawn via an EFT now includes:
- Australia
- Austria
- Belgium
- Canada
- Finland
- France
- Germany
- Holland
- Hong Kong
- India
- Ireland
- Japan
- Mexico
- Poland
- Russia
- Singapore
- Spain
- Sweden
- Turkey
- Ukraine
- United Arab Emirates
- United Kingdom
- United States
Additionally, Paxum announced that it has resumed its ACH service, giving the ability for customers in the U.S. to load and withdraw funds between their bank and Paxum.
Customers may hold balances with Paxum in USD, CAD, EUR and GBP through a wallet for each currency desired.
This EFT withdrawal will likely be valued by immigrants wishing to send remittances to family members back home. Recently the U.S. Consumer Financial Protection Bureau issued new rules requiring greater transparency regarding fees along with additional regulation. To-date, Bitcoin hadn’t been particularly useful for remittances due to Bitcoin exchanges not having banking relationships in the developing countries where the bulk of remittance transfers land.
From the U.S. alone there are US$400 billion in remittance payments made and globally nearly that same amount in remittances are transferred to just to developing nations.
tl;dr: Paxum just expanded to the developing world — a new frontier for Bitcoin.
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First BTC/INR Trades Booked on TradeHill
Indian Rupees (INR) are now being used to buy bitcoins and bitcoins are now being used to buy Rupees.
INR funds may be deposited with the TradeHill exchange from any Indian bank. Once funds have been received, a bid may be placed on the BTC/INR market and when there is a sell order willing to sell at that price the buyer’s order will be filled.
Those selling bitcoins for Rupees can then withdraw their INR funds at that the exchange to any bank in India as well.
TradeHill has been operating for over month now but these INR trades occuring this week were the first to execute through its BTC/INR market.
When the BTC/INR market firms up, this market will likely see a fair amount of activity from those who hold Liberty Reserve currency and wish to withdraw those funds as INRs. TradeHill also has a BTC/LR (LRUSD) market so converting from LRUSD to INR will involve two trades. The BTC/LR market has been favorable to those holding Liberty Reserve — enough so that even with the wide spread using TradeHill could become one of the least expensive methods for withdrawing LRUSD to INRs.
After PayPal this month added further restrictions for its customers in India, both Bitcoin and Liberty Reserve will likely get a boost.
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