Arf Taps into Lucrative Credit Line Market with Stablecoin-Based ‘Working Capital’

Traditionally, when a money service business (MSB) wants to send money from one country to another, it has to prefund the same amount in the receiving country, bringing about tied capital, high opportunity cost, and operational inefficiencies. What’s more, since cross-border transactions are often considered risky, access to credit has always been a major problem for MSBs.

Designed to empower licensed MSBs all over the world, the soon-to-be-launched Arf Credit emerged as an idea when Arf co-founders noticed that most MSBs had issues with high prefunding requirements and limited access to working capital.

Co-Founder Kazım Rıfat Özyılmaz says MSBs have been underserved players of the finance industry, especially in accessing working capital. “Of course, the industry must manage risks—but it also has to find innovative ways to enable the growth of cross-border transactions,” he underlines.

“The real problem with the current cross-border payments industry is that when you’re successful as an MSB, you need more money to run it,” says Co-Founder and CEO Ali Erhat Nalbant. “We developed Arf Credit as an API-based, transactional short-term working capital in USDC so that MSBs can use stablecoins without prefunding.”

Although options existed, most lenders only served customers with long-term credit needs or single payout corridors. Application processes were lengthy, and once the credit was given, it had to be repaid regardless of whether it was used.

Co-Founder Berhan Kongel says that licensed MSBs can instantly get the credit with a 2-7 day repayment period. “Each eligible MSB is assigned a certain amount of credit based on its transactional volumes within the Arf Network. They only pay interest for the credit amount used, and can automate repayments,” he explains. 

“We are really excited to be a key player in enabling the cross-border payments industry to compliantly benefit from the blockchain and digital assets,” Ali Erhat Nalbant says. “It was a much needed improvement in global payments.”

Ali Erhat Nalbant will be on stage at Paris Blockchain Week Summit for The Future of Crypto Payments, on the Junior Stage, for a panel talk that invites our audience to brainstorm and imagine the future of crypto payments and consider the possibility of mass adoption of crypto payments, and what new technologies will emerge in the coming years to facilitate payments. April 14th at 5:00-5:40 PM CEST.

He will be joined by Constance Wang, COO of FTX, Iana Dimitrova, Chief Executive of Openpayd, Damex, and moderator Jordan French, Executive Editor, Grit Daily & BlockTelegraph. BlockTelegraph will cohost with Grit Daily the Celsius Network VIP Dinner, April 13 at Astair.

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