Where's the Arab Version of Venmo?
By: Mariam Kanaan/ Arab America Contributing Writer From FaceTime to WhatsApp video calling—even Snapchat calls—Voice over IP (VOIP) systems are blocked in many parts of the Arab World. Across, the Middle East and North African region (MENA), it’s clear that nations want to produce their own economy-backed telecom companies. WhatsApp is restricted in Lebanon and uses prepaid services, selling WhatsApp only data cards, while entire businesses depend on social communication technologies. In the Kingdom of Saudi Arabia, Duo is the primary source for video calling abroad and has not yet been blocked as of 2020. It’s no wonder tech giant Facebook bought the service in 2014. With such a prevalence across the globe, communication is now easier than ever, even with the aforementioned restrictions.
The New Face of Fund Transfer
Enter a new technological player: Peer-to-peer financial system Venmo. Fund transfer has a new face in the United States in the form of the increasingly popular Venmo (owned by Paypal) in coastal urban life and its close competitor Cashapp (Square, Inc.) among others. Apple and google pay followed suit, but Venmo has become a part of the growing culture. What was once a traditionally carefully calculated transfer of funds from bank account to bank account has become an instantaneous and “emoji-ful” “what’s $200 between friends.” Gone are the days of “Can you spot me a fiver?” Forget your wallet? That friend who forgets to pay you back no longer has the excuse of not seeing you physically. It takes exactly 59 seconds on average to repay your friend, coworker or (more recently) pay for commercial services.
Popular among millennials, the cashless generation relies heavily on using the app for everything from socializing and fundraising to buying and selling goods online and even from participating brick and mortar merchants. When it comes to traveling abroad, however, millennials come to a screeching halt and it begs the question: What are our cashless options? Venmo is not available outside of the United States (that’s right–not even Canada, no poutine emoji for this Venmo transaction).
What would Peer-to-Peer Funding look like in the MENA?
Technology plays a major role in the day to day life and communication between family and friends from the Arab world and the west evolved from immigrant youth in the 70s and late 90s writing letters and using phone cards for prepaid phone calls timed to the minute to hours of free calling, texting and sharing photos. Video calling your grandma has never been easier.
Millions of Arab Americans have family members in the Arab world and visiting their families is crucial. As of 2013, Zoghby International reported that there were over 3.6 million people of Arab American origin in the U.S. Western Union, the grand central station of international money transfer, remains a primary method of sending money from here at home to the Arab world, whether it’s to Lebanon, the gulf, the north African Maghreb, or central Africa. But sending money within the nation’s borders is an entirely different animal. Whenever you go to the MENA, it’s likely that you’re heavily reliant on bringing cash.
The Whatsapp Tax in Lebanon
Take for instance what happened this year. In October of 2019, the Lebanese government set a “Whatsapp tax”. That was the straw that broke the camel’s back. After facing forest fires, the WhatsApp tax was the line that set off the nation into a series of protests that gained support from the millions of Lebanese expats across the globe. Not but a few months in, the coronavirus epidemic paired with the fall of the Lebanese Lira led to a crumbling economy. Naturally, the Lebanese diaspora was the only source of aid for family members left behind within Lebanon’s borders. Watching a sinking ship from outside of Lebanon, Lebanese Americans could not send their loved ones money by wire transfer, not for fear of transaction fees, but because Lebanese citizens were physically blocked from taking out their own hard earned savings from their bank accounts.
Lebanese expats from across the globe flew in with envelopes of dollar bills to save their families. This helped thousands, for it’s rare to find a Lebanese family that does not have a relative (immediate or otherwise) earning money elsewhere.
People still could not use cash unless it was brought from outside. They couldn’t pay their rent, buy food, or make any sort of transactions.
If there were a form of digital payment exchange, some kind of fintech that could allow people to send each other money without having to rely on cash, but instead the promise of their own hard-earned and available monies, people could have ridden the waves above water instead of drowning in their debts.
Is there hope?
Prior to COVID-19, rumors surfaced that banks in the region were beginning to come up with their own campaigns for digital payment methods, similar to the American-based Zelle. That’s as close as they’ve gotten, for now.
In the 2010s, the Arab spring was prompted by the new generation of Arabs and with it ideas for technological advances that would improve their world. Thanks to social media, the global economy and society are more connected than ever. In the case of Lebanon, despite its economic and recurring political turmoil, the nation’s universities churn out thousands of fiery, educated, and fervent young minds with the potential and the vision for a technologically advanced, secure future for their country. Needless to say, this is true for most of the Arab world. Unfortunately, these minds keep going where their talents are recognized due to the fact that the opportunities just aren’t being provided to them.
We’ll just have to wait and see what they come up with.
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