The Burden of Transfer Fees on Migrant Families
Migrant workers send over $800 billion annually to their families, but bank and transfer fees consume about 7% of that amount-over $50 billion. These fees severely impact families in developing countries where remittances are a primary income source. From an Islamic finance perspective, such fees may involve gharar (uncertainty), as the sender cannot predict the final cost.
Islamic Finance and the 'Seller Owns the Asset' Principle
At Qist, we adopt the principle that 'the seller owns the asset,' meaning the buyer pays no separate transfer fees. Instead, the asset is directly owned via USDC at a transparent cost. This eliminates intermediaries charging unknown fees and complies with the prohibition of riba and gharar.
Impact of Fee Savings on Household Income
Eliminating transfer fees increases net household income by an average of 7%. For example, a migrant sending $500 monthly saves $35 per month, totaling $420 annually. This extra income can cover essentials like education or healthcare.
Qist: An Islamic Model for Fee-Free Transfers
Every transaction is executed via smart contracts verified on BaseScan, ensuring full transparency. Any surplus is returned (following the 'surplus returned' principle), with a 3-day grace period before penalties. Only a 2% service fee is charged, far lower than traditional transfer fees.
How Qist Implements This
The migrant purchases digital assets via USDC on Qist, then sells them to family at cost without transfer fees. The family receives funds directly in their digital wallets, bypassing intermediary banks. This reduces costs and increases net household income, aligned with Islamic finance principles.
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Informational content only, not financial advice