Charles Hoskinson of Cardano (ADA) pointed to a video which spoke about the foundational concepts to be considered when establishing decentralized financial system for the unbankable.
Sydney Ifergan, the crypto expert tweeted: “DeFi inclusion in terms of Charles Hoskinson (cardano) is the core need for everyone who needs to transact. Hopefully, Cardano hits it big, thus making it possible for all to be financially included.”
The video speaks: How do we go about establishing Decentralized Financial System for the unbankable? The first step in this process is to find the right place to implement this technology. If we take a look at African, we can see that Africa has the highest population density without access to traditional banking services. So, how do we go about getting these financial services to these people?
Out of 1.5 billion adults who don’t have a bank account, more than one billion of them have a mobile phone. In this day and age, there is no need for massive infrastructure to provide traditional banking services. The tools we need to solve this problem are already in our hands.
About 80% of Africa’s population is under 30, which means barrier for implementing this tech is relatively low. People already know a lot about what is required to make this work. This presents Africa as a top candidate for Fintech and if you couple that with the fact that Africa has the second largest GDP growth, which represents growth in the middle class. You can see how this is an ideal market.
GDP growth in the middle class are the key ingredients to see the flourishing financial system and the future of lending insurance, but there is a problem: Optimal places in Africa have some of the highest concentrations of fraud and corruption in the world and that makes it impossible to operate a sustainable financial system in these regions and that is not to say that there are no banks in Africa, because there are. But the ability to provide people is severely limited. When serving members in the financial industry and Sub-Sahara Africa, more than half of them are reporting falling victim to fraud in the last 5 years along with high numbers of bribery and corruption, regulatory breach, identity theft, and money laundering.
So, in order to provide Fintech solution to the unbankable, we actually need to solve another problem first. Documentation and identification in the form of digital identity. Digital identity are the cornerstone of establishing one of the most important things, when it comes to lending, which is trust.
Trust that you are who you say you are, and trust that you have the assets and documentation you claim to. All having the ability to be held accountable. Traditional IDs are easily counterfeited like any kind of standards across borders and to provide internationally recognized identification for its people.
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