Customers of El Salvador’s largest bank, Bancoagrícola, will now be able to pay down their loans and credit card bills in bitcoin.
El Salvador’s largest bank, Bancoagrícola, is now accepting payments of loans and credit card bills in bitcoin. They can also now use the leading cryptocurrency to purchase goods and services from merchants connected to the bank’s payment gateway. Bancoagrícola, founded in 1955 and now owned by Grupo Bancolombia, has partnered with New York-based payment network Flexa to enable the payments in bitcoin via its mobile app.
El Salvador makes history as bitcoin becomes a legal tender.
Bitcoin law went into effect on Sept 7 in El Salvador, making the leading cryptocurrency an optional legal tender in the South American country. El Salvador became the first country in the world to officially recognize bitcoin as a legal tender. According to an announcement from Flexa, Bancoagrícola’s customers will be able to pay U.S. dollar-denominated loans and credit card balances with bitcoin at “the exact fair market rate, without any additional fee or spread.” The option is designed to work with any wallet compatible with the Lightning Network, including El Salvador’s official wallet Chivo.
Flexa is planning to announce compatibility with several payment gateways.
Merchants in El Salvador that are set up to accept payments using the Bancolombia Group’s Wompi gateway can accept bitcoin through Flexa as well. Those payments are largely online, for now, Flexa CEO and co-founder Tyler Spalding said. However, the company is also planning to announce compatibility with other payment gateways, Spalding added. Businesses operating in El Salvador, including multinational chains like Starbucks and McDonald’s, are now required to accept bitcoin as a form of payment if they have the technology to do so. On the other hand, consumers have the option of whether they want to pay using cryptocurrency or stick with the local U.S. dollar currency.