By Anirban Ghoshal
New Delhi, June 19 (IANS): Indian startup Trestor, an alternate to crytocurrency Bitcoin, has partnered with the Cameroon government to deliver last mile services in the southwest African country.
As part of the agreement, Trestor and Socapssi, an organisation created in Cameroon to bridge the gap between the informal and national insurance sector (CNPS), as also the government will ensure that the new currency ecosystem goes live.
To test the project out, the parties had done a pilot to test the feasibility.
"The results were excellent. We enrolled 500 people between the ages of 15 and 35 from a small economically-knit community. We asked them to use 'Trest' as their default method of payment for 30 days," Antoine De Padoue, founder of Socapssi and president of RDPF KUMZE, Cameroon's minority opposition party, told IANS.
"In short, we artificially created a Trest-based micro-economy. People were able to comprehend and understand this very new method of payment. They were excited and started improvising their own uses within the first five days of the pilot. We achieved quantifiable efficiency gains and the benefits far outweighed the negatives," De Padoue added.
Socapssi has signed an agreement with CNPS for the project. "Our first Trestor retail partner location is now functional. Over the next 12 months, we will enroll 500 Trestor retail partners across Cameroon (10 regions, 54 divisions and more than 360 sub-divisions). This will create 1,200 to 1,800 direct jobs," De Padoue said.
The CNPS aims to ensure efficient delivery of government-sanctioned entitlements and other benefits assigned for the people of Cameroon. "Trestor and Socapssi have created a payment system where none existed. Trestor has successfully demonstrated that peer-to-peer payments can still function in areas with practically zero banking and telecom infrastructure," Trestor founder Kunal Dixit told IANS.
"This essentially is like giving world's best banking to the most poor for absolutely no cost," Dixit added.
Asked about Cameroon's chosing not to use banks to engage CNPS, De Paduoe explained: "The banking sector in Cameroon serves only 10 percent of our population, In addition, physical movement of cash is difficult and unsafe. Retail banking is both a challenge and an opportunity. Gradual financial deepening is underway but the pace is frustratingly slow due to low income levels and a weak judicial enforcement mechanism."
"Our president, Paul Biya is a visionary. He is a partnership man, always looking for new ways to leverage technology to serve the people of Cameroon. At CNPS, we promote technology partners like Trestor & Socapssi to run pilots and see if their solution can help CNPS execute its mandate," he added.
Only 10 percentof Cameroonians have bank accounts but over 75 percent have access to mobile phones. this made CNPS look for peer-to-peer payment solutions which leveraged internet instead of conventional banking, Trestor and Socapssi said in a joint statement.
The government bodies had first looked at aligning with Bitcoin despite its price volatility before engaging with Trestor.
"Bitcoin's transaction fee to the user was low but the real cost to the network was unimaginable. That was a deal breaker for us. We couldn't believe the Bitcoin network consumed about $18.95 of electricity to process a single transaction," De Padoue said.
"In Cameroon, we can feed 40 people with that money. Trestor caught our attention because it claimed zero transaction fees. The Trestor team was transparent and let us study their real acost per transaction," he added.
Trestor's mission is to create an efficient money, payment and market system. Dixit expected Trest to become a common digital token with stored value like Bitcoin which has a capital value of $3.5 billion.
"Right now we are 0.015 percent of the gold's market cap but we want to be one percent in five years. Roughly, that means $1 invested today would be $76 then," he explained.
Trestor's India office targets local businesses in metros and tier-I and tier-II cities.
"Our aim is to bring on board shops that sell daily-use goods and by doing that we will spread the network faster," Dixit added.
Currently, Trestor has recorded a global sale of $3 million trests (the currency) and an India sale of over $1 million. "India accounts for 35.6 percent of our India sales," Dixit said.
The startup has 621 retail partners in 66 countries, including 239 Indian retail partners.