The Gates Foundation is to use Ripple’s Interledger Protocol to address issues of financial inclusion in the developing world.
The use of blockchain as a tool for doing good has slowly been taking steps toward becoming a tangible reality in recent weeks. As ToshiTimes reported recently, Binance announced that with immediate effect, 100% of its listing fees were to be donated to charity. Now, according to a tweet from the Deputy Director of the Gates Foundation, Miller Abel, the charity has plans to partner with Ripple and Coil in order to explore creation of what he described as “pro-poor payment systems.”
— Miller Abel (@MillerAbel_) October 17, 2018
So what does “pro-poor” mean? Well, the Gates Foundation is a huge engine in the global charity sector and is working at tackling some of the biggest problems facing developing countries. It has already made great steps toward its target of wiping out malaria globally and it has also authored its Mojaloop payments system, designed to tackle financial exclusion in developing countries.
One of the great obstacles which needs to be overcome in the developing world is the fact that payment infrastructure which is being built is often done by private enterprises which are local, so-called closed-loop services and do not interact with each other at a higher level. As a result, these local banks must charge high transaction fees for payments sent between them limiting the usefulness and inclusion they provide to local people. Mojaloop is an interledger system which aims at breaking these closed loops by providing a single platform for moving between banks, thereby bringing them all under one loop – “Moja” being the Swahili word for “one”.
Ripple meanwhile is providing its Interledger Protocol as the solution under the hood for the vision behind Mojaloop. Coil, which was founded by Ripple’s former CTO Stefan Thomas is presumably providing its interledger platform to foster content creation and payments simplification expertise in regions which Mojaloop is aimed at.
Ripple’s XRP currency was initially designed to facilitate smoother and faster inter-bank transactions, so this project looks like a perfect fit for their tool. World Bank data shows that around 1.7 billion people globally are “underbanked” – meaning they lack access to banking infrastructure and its benefits. These people generally use cash for all of their transactions, limiting the options to use their money they have open to them. Blockchain banking solutions however promise to open up a full menu of banking services to people with just an internet connection, potentially changing the lives of millions, as well as allowing significant amounts of new money to flow into the global financial network.
Image Source: “Flickr”
Alex has been putting words on paper since he was old enough to hold a pen; when he bought his first bitcoin in January 2017, those words discovered their place within crypto as well. He holds a master’s degree in international relations from Leiden University in the Netherlands, and his special expertise lies in European cryptocurrency regulation.