Payments, Code of Hammurabi and Quona's Latest Investment

Payments are as old as the human race; the barter system pre-dates even formal currencies, so did the code of Hammurabi from 18th century BC, which has elaborate sections on commerce and payments. Fast forward 4,000 years and payments form the backbone of financial transactions today – between individuals (P2P), between businesses (B2B), between individual and business (C2B) or between individuals and government entities (G2C or C2G).

Also, the social and economic face of money and payments is transforming. We don’t store all (or even most) cash at home - it’s mostly in electronic form with financial institutions; carrying cash for large payments or carrying exact change for micro payments is cumbersome. The multiplicity of payment options and their inability to talk to each other effectively is frustrating. The emergence of digital currency is changing and challenging established payment behaviors. And of late, explorations by some central banks to launch their own digital currencies has gained momentum.

Nowhere is the issue more pronounced than the fast changing landscape of Asia, particularly Southeast Asia and India. There is a real opportunity for new payments architecture to integrate with existing systems to make payments omnipresent and seamless. The result? Faster, cheaper, and more efficient payments for all.  But, given the challenges in establishing ubiquitous new payment platforms, including the flexibility needed to satisfy the wide variety of consumer, governmental, and business needs, the scale necessary to succeed, the low profit margins and the competitive landscape, we have seen limited success.

In light of this, digital payments and transactions start-up Coins is refreshingly innovative and could be transformational for payments. Built on the back of new age architecture and a distributed ledger, Coins is a mobile-first, branchless, digital financial services provider.  It offers a comprehensive set of payments services, such as P2P transfers across bank accounts, digital wallets, and physical cash-out (via strategic partnerships with agent networks), as well as bill payments and mobile top-ups.

Coins leverages blockchain as a means of quick and inexpensive settlement, and has largely decoupled the consumer experience with any of the complexities or risks that are typically associated with the technology. Think of it as WhatsApp in the age of SMS: while WhatsApp and SMS arguably deliver the same message, WhatsApp is a fundamentally different platform, leading to a better user experience, including privacy/security and lower cost.

To bring the difference to life, an actual Coins customer based in Hong Kong went to a local partner bank to load his digital wallet with funds to transfer. The bank offered to accept cash and transfer the amount to the customer’s Coins wallet, but the settlement period was two weeks! When the customer contacted Coins, they helped load his wallet at the nearest bitcoin ATM – the transaction was complete in 15 seconds! 

Coins.ph is at the forefront of payments and financial services transformation driven by digital and financial infrastructural changes in SE Asia. The coalition of global and regional investors who are participating in this round along with Quona (managing Accion Frontier Inclusion Fund), including Kickstart, Wavemaker & Innovation Endeavor (existing investors), Global Brains, Digital Currency Group, Pantera Capital and BeeNext, is a great validation of the solution Coins implements.