Sierra Leone and UN provide financial services to unbanked people

Sierra Leone, a West African country, has partnered with two UN agencies (UNCDF and UNDP) and a non-profit organization specializing in technology (Kiva) to create a new system. national digital ID based on the Blockchain. This system will help the 80% of unbanked Sierra Leoneans to prove their identity and solvency .

The Kiva Protocol

Sierra Leone President Julius Maada Bio has signed a Memorandum of Understanding with the non-profit organization Kiva, the United Nations Capital Development Fund (UNCDF) and the United Nations Development Program (UNDP) to modernize the country's Credit Reference Office. The initiative aims to provide credit, banking and identity verification services to millions of citizens who have not been able to enjoy all of this until now, according to a press release dated September 27.

Called the Kiva Protocol, the digital identification system will be set up on the Blockchain platform of the non-profit organization in the form of digital portfolios issued to Sierra Leoneans . They can access their wallets through a mobile application on their phone, or through a micro-finance agent operating in their community (they will only be able to handle the material in question). 'with the permission of the owner.)

In addition, users will be able to capture their Credits incidents (for example when they contract or repay a loan or receive credit from a local seller). This will make it easy to check their creditworthiness in a timely manner.

Transform the financial landscape of Sierra Leone but not only

Sierra Leone was chosen because it has only one credit rating agency covering nearly 2,000 people - less than 1% of the country's population -. However, more than the majority of the population (80%) deserve equally these benefits.

The Kiva protocol encompass a wide range of financial transactions - bank loans to a local merchant - to help the maximum individual access to financial services, including business loans, student loans and medical services basic.

"If someone wants to apply for a loan from a national bank, they can give them a unique access to their digital wallet so they can check their credit history . " The system is also very inexpensive to operate, which eliminates the type of fees that could prevent people or institutions from using other credit reports, can be read on the Kiva website.

"With this implementation, Sierra Leone is preparing to build one of the most advanced and secure credit bureaus in the world," said Xavier Michon, UNCDF Deputy Executive Secretary.

It could serve as a model for developing and developed countries in the future and has the potential to radically change the landscape of financial inclusion.

What do you think of Sierra Leone's and the UN's initiative to provide financial services to unbanked citizens? Share your opinion in the comments section below.

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