NGO reshapes microfinance via blockchain

ANKARA- Anadolu Agency

A Turkish NGO is set to use blockchain technology to enable entrepreneurs to get funded by social investors anywhere in the world, the head of the foundation said on Aug. 16.

In an exclusive interview with Anadolu Agency, Aziz Akgül, the head of Turkish Foundation for Waste Reduction (TİSVA), said blockchain-based microfinance is inevitable not only for the future of Turkey but also for the entire world.

"We want to give microcredit to 3.5 million people by employing cryptocurrency and e-marketplace in Turkey by 2030," he added.

The main target of TİSVA - which oversees the Turkish Grameen Microfinance Program (TGMP) - in launching such a project is to solve the problems of global microcredit community in finding financial sources for the poor.

Turkish Grameen Microfinance Program is a non-profit economic foundation offering "microcredit" services to help reduce poverty in Turkey, according to their website.

"TGMP came up with the idea that creates an alternative financing model for social businesses to alleviate poverty through blockchain," Akgül said.

Pointing to the rising popularity of using cryptocurrencies like Facebook's Libra, Akgül claimed that the world has entered a new era in which the number of banknotes in circulation will fall.

"The market size will not be confined to Turkey," he said. "The initiative will be extended to micro-entrepreneurs all around the world."

Citing a report released by Oxfam, an international confederation of NGOs working to reduce poverty, Akgul said the wealth of the world's richest 26 people equaled to that of 3.8 billion poorest people in 2018.

"We aim to impact the lives of these people through the project," adding that financial inclusion as the primary concern of the project is an important step toward reducing and ending poverty."

He suggested that blockchain technology will eventually enable anyone with an Internet connection to have access to a wide variety of poverty alleviation services at a fraction of the cost.

Blockchain is a database of financial transactions which is saved on multiple computers and constantly grows as new transactions or "blocks" are added to it, forming a continuous and public chain of data.

He also explained that under the project, 300 million MicroCreditCoin (MCC Token) and mobile wallets have been produced within the Ethereum blockchain technology, the popular cryptocurrency based on the use of tokens, which can be bought, sold, or traded.