Latin American Exec: Employees Could Earn 5% More with Bitcoin

Bitcoin's potential to cut credit and debit transaction fees and exchange rate costs is often seen as its biggest advantage to international businesses.

However, to entrepreneurs in developing countries the virtual currency represents an even greater opportunity: the end to costly trade restrictions that inhibit their profits and ability to compete.

Ulf Kuhn, founder of Chile-based telemarketing business Telemarketing Facil, has learned this lesson firsthand. The German native moved to Chile three years ago to export business ideas and learn more about developing markets.

However, he soon found that the traditional banking system was there to impede his efforts every step of the way. During his relocation, Kuhn says he was "scammed" with 25% percent transaction fees for international bank transfers and money transfers.

Since launching Telemarketing Facil in 2013, he hasn't exactly found the banking environment more accommodating.

To begin, Kuhn reports that even paying employees via the current banking system is difficult, given that his business serves all of Latin America.

With employees based in Mexico and Colombia, workers incur additional costs in the form of currency exchange rates as well as bank and payment provider fees. As a result, the payment process at Telemarketing Facil works like this:

"Our employees could earn 5% more," Kuhn said.

Fees don't just directly impact transactions at Telemarketing Facil, however. Kuhn says the company loses clients because its invoices don't include bank fees. Still, it could be worse, Kuhn notes. If Telemarketing Facil was based in Argentina, it might not be able to exist at all.

There is one potential remedy to Kuhn's challenge – virtual currency. The entrepreneur believes that widespread bitcoin use in his market this would revolutionize his ability to conduct business.

Kuhn began accepting bitcoin on 17th January after attending a bitcoin meetup where he spoke with Nicolas Cary, CEO of Blockchain.info, about bitcoin and its potential use in international business.

Should all its clients pay in bitcoin or use the technology for payments, Telemarketing Facil's payment process would include fewer steps and fees:

While promising, such a scenario is unfortunately not on the horizon for Telemarketing Facil. Kuhn notes that he hasn't had any customers yet take advantage of the new payment option, though some tech startups with USD bank accounts have expressed interest.

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Furthermore, Kuhn says that there are some problems that need solving before bitcoin takes off in the B2B space. He cited that easy escrow payments, as well as clarity by governments on bitcoin's tax status would be beneficial.

Existing players in the bitcoin ecosystem could do more as well. Kuhn noted that it's currently too difficult to get bitcoins because big trading platforms don't have bank accounts in Chile.

But, Kuhn isn't discouraged, as he understands that adoption will take time.

“I see a big potential for B2B bitcoin transactions for exporting companies, especially in Argentina, Colombia, Chile and Peru," he said.

Image credit: Telemarketing Facil