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Internet service provider and software developer Bitpalace adjusted its prices to the OECD purchasing power index of its clients’ countries. In poor countries local Bitpalace services are offered at prices that are affordable with respect to people’s per capita income. In this way Bitpalace provides access to IT-services for people in poor countries, who normally wouldn’t be able to afford it.

Grexit or not, Greece’s financial systems will collapse. As if that wasn’t enough the Greek people also have lower incomes compared to their European neighbors, making imported goods and services expensive from a Greek perspective. However, in relation to income, living expenses in Greece are as high as in other European countries, since many goods have to be imported from other countries at prices that are considered normal there.

Normally, currency exchange rates serve to equalize such differences in spending power. It’s not an exact science, but it works more or less. In the euro zone, however, it doesn’t work at all because there is no exchange rate between the German Euro and the Greek Euro. Germans can afford to buy more in Greece than Greeks can in Germany, since the German average income is significantly higher. For Greek people on the other hand the difference in spending power is an obstacle to purchasing things in Germany. The same is true for people from Poland or the Czech Republic who have to pay higher prices in Germany. And it’s also true for Germans who pay 75% more for their Schnitzel in Switzerland than they would at home.

Great differences in spending power are also common between European and non-European countries, even though the latter ones are often poorer. Due to their low income, most non-Europeans cannot afford European services, let alone German ones. This creates a sales obstacle for European exporters and people in poor countries face the more severe obstacle of getting out of poverty.

For this reason internet service provider and software developer Bitpalace launched its own development aid program. The company now adjusts all of its prices according to the OECD spending power index of its clients’ respective countries. In Greece, for example, prices for Bitpalace internet and software development services have been lowered by the percentage Greek spending power is below German spending power. The same goes for all other countries whose spending power is below that of Germany. Therefore, people in those countries will perceive Bitpalace prices to be fair and adequate in relation to their income.

To arrive at fairer prices Bitpalace uses regularly updated OECD (Organisation for Economic Co-operation and Development) statistics on spending power parity. OECD currently has 34 member states, including all major industrial nations. Buyers from non-OECD countries can purchase almost all Bitpalace services at cost, since those countries already have a lower per capita income than Germany.

Bitpalast GmbH
Sensburger Allee 27
D-14055 Berlin (Germany)

Interview partner: Peter Debik M.A.

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Fax from Philippines +49 30 32 70 18 91

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