Sierra Leone And The United Nations Concatenate To Develop Blockchain-Identification System
Two divisions of the United Nations – the United Nations Capital Development Fund (UNCDF) and the United Nations Development Programme (UNDP) – together with the non-profit start-up Kiva and President of the West African Republic of Sierra Leone announced the project named “modernization of the credit Bureau”. Within the framework of the initiative, it is planned to create a blockchain system that allows each resident to obtain a digital identification and a personal wallet with a credit history.
According to representatives of Kiva, Sierra Leone was chosen due to the fact that there is only one credit Bureau in the country, serving about 2,000 people, which is less than 1% of the total population. Kiva has worked without blockchain for over 13 years. And even without the DLT, the nonprofit organization managed to raise more than $ 1.2 billion in loans to people in more than 80 countries. In addition, 80% of citizens do not have access to banking services. This is especially problematic for people involved in startups and small businesses who are constantly looking for capital to launch or expand services. In the absence of an official identity and credit history, these people cannot access the mainstream financial system. In one example, even a well-known businessman could not raise the necessary amount to expand his business in Dubai. Reason: he had no credit history.
The government of Sierra Leone, in its previous efforts, had established a credit Bureau, but that alone could not facilitate the financial integration of people with zero credit history. Thus, Kiva’s blockchain-based identification system can improve the situation on the ground by giving non-Bank and non-Bank people their own digital identity.