Of the many hundreds of potential applications for blockchain, targeting financial inclusion is mentioned again and again.
According to a survey by the IBM Institute for Business Value and the Economist Intelligence Unit, one in seven companies it calls “trailblazers” expect to have blockchains in production and at commercial scale in 2017. Respondents were interested in taking advantage of the blockchain’s multiple benefits, which include cost reduction, immutability of records, transparency of transactions and the potential to create new business models. For example, the blockchain would eliminate the need for keeping multiple records at banks and other parties doing currency trades. The survey tracked responses of 200 global financial markets institutions.
Two billion people worldwide don’t have bank accounts and must conduct their transactions in cash―which can be difficult to manage and presents safety issues. Could blockchain, the technology underlying the digital currency Bitcoin, give them access to financial services? The Bill & Melinda Gates Foundation thinks so, and it is modifying blockchain, which is essentially a secure, reliable digital record-keeping system, to bring the poor into the formal economy.
The initiative is part of the Gates Foundation’s Financial Services for the Poor program―specifically, its Level One Project, which gives governments and central banks a framework for creating national digital payments systems that anyone can use, even those who live on a few dollars a day.