The blockchain technology came into the light in 2016 in Africa. It has proven so far to be a great deal of help for the African continent. Now, small-and medium-business can easily get loans to run their businesses from crypto and blockchain companies enthusiastic about growing the space. Previously, SMEs in East Africa had found it difficult to acquire loans from the bank as they were wary of lending money to these small and medium enterprises because of the risk involved. However, the involvement of the blockchain technology brought a change where each of the SMEs can build their own reputation.
The blockchain technology makes it easy for lending companies to monitor and businesses that can keep healthy business practices and also helps in tracking records and transactions. The blockchain is immutable and keeps a digital document of every transaction,therefore transactional histories and information that allows financial firms to broaden their reach and expand to other regions are accessible on the technology.
SME’s are not the only ones benefiting from the blockchain technology financially as farmers across the continent are getting financial inclusion and services. CEO of 4G Capital, Nairobi-based loan provider, Wayne Hennessy-Barrett says, “If a small-shop owner can take 10 $200 loans over the course of a year and there are 3.25 million small shop owners and 10 times that number of traders, you’re talking about a lot of people who need to buy inventory and sell it and don’t have access to a financial product designed around their needs.”
Some persons have become beneficials of the technology and Janeffer Wacheke is one of them. She had been able to get loans from a blockchain based company, it has helped in the growth of her business. She says, “My prayers have been answered. In business, you need to be fast. The more you pay, the more you get bigger loans, and the more you can sell. It has really helped me.” She was able to gain access to loans through a blockchain-based mobile app developed by International Business Machines Corp. For East African country, Kenya,Microloans account for $6.5 million of a $20 billion informal economy sector of the country.
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