Bancoa grícola, the largest bank in El Salvador, announced on September 9 that it will accept Bitcoin payments for a series of services in partnership with cryptocurrencies payment company Flexa.
The announcement was made by Flexa via a blog post on Thursday where the company would help the megabank to enable Bitcoin transfers for the bank’s customers, including retail and merchant clients.
Bancoa grícola will accept Bitcoin all over its network, including loans, credit cards, and payments for merchant goods and services, following the country’s Bitcoin Act, which was enforced on the 7th of this month.
Clients would be allowed to take out US dollar-denominated loans and credit card payments using wallets compatible with Bitcoin Lightning Network such as the wallet app Chivo, which was launched on the same day as well. In addition, there will be no additional fees charged by the wallets and payment systems.
According to the blog post issued by the company, the bank has also committed to “bringing turnkey, fraud-proof bitcoin payments via Flexa to all of its clients’ point-of-sale (POS) terminals by” year-end.
Carlos Mauricio Novoa, COO of Bancoagrícola, said in a statement:
“We are excited to be the first financial institution in El Salvador to enable bitcoin access for our customers across our entire suite of financial products and to enhance financial inclusion.”
Trevor Filter, co-founder of Flexa, added:
“The opportunity to partner with organizations as innovative and world-class as Bancoagrícola and Grupo Bancolombia so that we can support better payment technology for millions of Salvadorans in such a tangible and impactful way is simply incredible.”
One of the reasons El Salvador adopted Bitcoin as its legal tender was because a lot of the country’s citizens receive overseas remittances as their source of income. According to the Bank of America (BofA), these remittances add up to 24% of El Salvador’s gross domestic product (GDP).
President Nayib Bukele, at the time, noted that the adoption of Bitcoin will save El Salvadorans millions of dollars in fees when receiving remittances from abroad.