Does Blockchain Really Have Any Potential To Help Weaker Sections Of The Society?
The online media is rife with the extremely positive stories of Blockchain technology heralding it directly or indirectly as the precise tool to revolutionize each aspect and section of the society- for better. While the Blockchain cannot be called the magic wand to solve every social and economic issue, the technology does have a huge potential to bring significant positive changes in the long run if it is implemented wisely and honestly …. And of course, selflessly (or at least with a balanced proportion of commercial objectives and social good).
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The good thing is that there are multiple real cases uses where the Blockchain technology has successfully been implemented and utilized for social welfare with proven results. Some of these real-life cases have been implemented in poor countries like Kenya and Somalia and are successfully being used by the lower or lowest rungs of the society. It shows that there are diverse ways in which Blockchain can really help the underprivileged section of the society.
Better financial management
The income of economically weaker population of the world is too low to be stored in the banks. The associated bank charges further makes it a worthless attempt. Besides, a massive underprivileged population of the world doesn’t have proper ID documentation and it is the major “official” reason that they don’t have bank accounts either. There are other “unofficial” reasons too. Men are too busy to engage themselves in banking schedule and women don’t visit banks due to illiteracy, hesitation, or social restrictions. The condition of their peers with proper ID documentation isn’t much better either, due to the third class citizen treatment they get from bank executives that compel them to avoid opening a bank account.
There are social welfare organizations who want to elevate the financial situation of the underprivileged section but the lack of centralized data (for the want of identity documentation/history) restricts their capabilities.
The Blockchain can help the underprivileged section to secure a digital identity that could be accessed anywhere anytime and via any net-enabled device. Thus the Blockchain will make it easier and quicker for them to access/apply for the funds. Immediate funds availability means better education, quickly assess to healthcare, timely repayment of loans and in short, a better lifestyle with healthy growth opportunities.
While almost all the countries have a proper official system for property rights, not all of them are practically functioning the way they should be. Delays, discrepancies, corruption, and heavy paperwork are some common issues that make things difficult for people. It is even worse for the underprivileged sector that lacks resources and proper education.
Due to its decentralized ecosystem, the Blockchain can precisely resolve these structural hurdles and make the things easier for the economically weaker or underprivileged communities. The digital availability of property ownership rights and strong tracking provisions makes it almost impossible for the unscrupulous elements to take advantage of the underprivileged sections and steal their property rights by faking/tweaking documentation.
It will also enrich the economic information pertaining to the underprivileged community and streamline the information flow across diverse channels that can help in assessing and eventually elevating their condition.
During the disputes, the underprivileged community is at the weaker end as the other party has strong connections and resources to tweak the decision in their favor. Blockchain is largely a self-evident ecosystem that does not have any central authority or intermediaries and it fully eliminates the chances of corruption or backdoor bribery.
Besides, the smart contracts and Merkle-tree based structure make it easier and quicker for the law officials to track and locate the legal and original owner of the property. It has a huge potential to prevent poor people from being cheated by unscrupulous elements.
Promoting Entrepreneurship through easy and streamlined microfinance
Lack of education causes unemployment and unemployment causes poverty…thus the vicious cycle continues. Applying a different perspective might help here. Employment requires formal education but entrepreneurship needs the worldly wisdom that many poor people already have thanks to the tough lessons the society teaches them. It might sound exaggerated but we are talking about micro-entrepreneurs. The local makeshift kiosks selling most basic necessities of daily needs like toothpaste, toothbrush and small pouches of detergents is also a form of entrepreneurship. However, they require some financial help to open such mini-kiosks or engaging in similar forms of tiny entrepreneurship.
With the help of microfinance, the unbanked segment can easily access the tiny amounts of loans. Currently, this segment heavily relies on traditional moneylenders who are notorious for taking undue advantage of poor people. There is no bank or official authority involved in documentation of loan that makes it much easier for the unscrupulous moneylenders to tweak the terms and conditions to achieve their vested interests like over-calculating the interest rate or grabbing the property/vital assets of poor people.
However, the Blockchain powered crypt currency now makes it easier for the poor people to get the microloans without any complicated documentation or paper work and more importantly without compromising on their legal rights.
Decentralized ecosystem saves the micropreneurs from being cheated by intermediaries while the distributed digital network saves them from the hassles of physically visiting the bank branches or maintaining/presenting physical documents.
It also ensures quick funds availability and helps the micropreneurs start their own venture ASAP.
Corruption is one of the prime reasons for poverty. There are a number of public welfare schemes announced every year with an objective to help the underprivileged sections of the society and economically weaker population. However, this vast series of evergreen schemes fail to make the picture greener for poor people. The major reason behind the same is that much of the cream is skimmed by the unscrupulous officials before these schemes even reach the intended beneficiary i.e., the poor section.
Besides, the official process of getting tangible benefits are generally so intricate or demanding that most of the people deem it fit to forfeit the benefits instead of struggling (in vain) to get them.
The decentralized structure of Blockchain effectively makes it airproof to the possibilities of corruption as it does not require any human involvement. The use of smart contracts further ensures that the system will exactly function as intended.
Every transaction is transparent and time-stamped that would effectively prevent even advanced technology experts from trying to corrupt the system.
It will save the poor community in diverse ways. No unscrupulous element will be able to cheat them of their meager properties, no public welfare fund will be siphoned off by the corrupt officials, and no red tapestry will try to delay the things with an objective to compel them to offer bribery or share the social benefits with them. Everything will be automated and streamlined.
The major strength of Blockchain technology is decentralization and trustless ecosystem. It effectively removes the intermediaries and streamlines the operations that can significantly help the weaker section of the society by reducing corruption, enhancing quick access to the economical help/resources and saving them from being cheated by intermediaries. However, things aren’t as easy as they may sound. It requires strong technical knowledge, resources, and several awareness campaigns to effectively use Blockchain technology for improving the underprivileged sections.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.