Abra Mobile Money Transfer Review

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Bitcoin Enables Abra’s Rapid Global Expansion

Abra is a peer-to-peer international money transfer app that enables users to send funds from smartphone to smartphone almost anywhere in the world, with very low fees.  Founded in 2014 and having raised $14 million of capital to date, this California-based startup first focused its product on the remittance market between the US and the Philippines.  Then Abra’s adoption of bitcoin and blockchain technology earlier this year enabled it to jumpstart a global expansion.  As of last April, the company supported 50 fiat currencies in addition to bitcoin, as well as a network of human tellers in over 100 cities around the world, including 1500 locations in the Philippines.

Before starting Abra, CEO Bill Barhydt recognized the pressing need for an alternative to traditional cross-border payment services that use financial intermediaries.  People weren’t able to send small payments from one country to another in the face of prohibitive bank fees.  “There are dozens of domestic peer-to-peer services cropping up in every country in the world,” said Barhydt, “but there is no one service that allows consumers to use their smartphones to send money person-to-person across borders in a similar fashion.”

Abra solved this problem by relying on a synthetic currency that can reside on users’ smartphones.  “Each person with a smartphone effectively becomes their own bank,” explained Barhydt.  As a result, Abra doesn’t need to pass on bank transaction fees to the consumer, and it isn’t subject to each individual country’s banking regulations, which would be an impossible prospect for a growing organization.

How exactly does Abra work?

Abra users can fund their digital wallets with bitcoin, their bank account (in the US or Philippines only), or an Amex card.  They can also give cash to an Abra Teller (also known as a “human ATM”) at a brick-and-mortar location.  In April, Abra announced that over 60 US banks and credit unions had joined its network, up from 17 at the company’s start. 

 

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Funds can be sent anywhere in the world via smartphone and cashed out in the local currency.  If funds are sent via bitcoin, the conversions can happen behind the scenes, so recipients who prefer fiat currencies won’t even be aware that the sender dealt in bitcoin.  There’s no need for them to wrap their heads around the complicated process of how bitcoin works.  Users worried about bitcoin price volatility can hold a more stable currency in their wallet but still send money to any bitcoin address.

The Abra wallet can be used as a noncustodial bitcoin wallet to send and receive bitcoin anywhere at any time and to pay any of the 100,000 merchants who accept bitcoin.  Abra eventually plans to allow the wallet to be used as a checkout vehicle and is testing out its API with a few merchants in Asia.  This concept works well in regions where the use of banks and credit cards isn’t widespread.

Abra charges no fees to add, send, or withdraw money from a bank account; however, the human tellers set their own fees and exchange rates when processing withdrawals.  There is a $500 transaction fee for ACH-based cash loads.  Transfers can take up to 2-3 business days, but Abra is aiming to shorten this time-frame to 1-2 business days.  It’s all part of the company’s ongoing push towards a better, faster, and cheaper user experience.


Marisa Fasciano
Content Specialist
Marisa is a communications consultant based in New York with a background in social research, diversity education, and nonprofit development.  She has lived and traveled abroad extensively… Read more

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