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Financial Inclusion for Refugees: Blockchain and Fintech Can Pave the Way, Says Elevandi CEO

Last Updated July 3, 2024 3:02 PM
Teuta Franjkovic
Last Updated July 3, 2024 3:02 PM

Key Takeaways

  • Industry leaders gathered at the Point Zero Forum to discuss the future of finance and how blockchain and fintech can revolutionize humanitarian aid.
  • Fintech and blockchain technologies are emerging as crucial tools in addressing the global displacement crisis.
  • Organizations like Elevandi are working to overcome challenges in implementing tech-based solutions and foster collaboration among stakeholders.

Recently, central bankers, policymakers, finance and Fintech leaders, technologists, and investors convened at the annual Point Zero Forum  at The Circle in Zurich to explore the future of finance through responsible AI adoption, digital assets, and payment frameworks.

Key topics included Europe’s regulatory challenges, promoting sustainable investments in emerging markets, and the humanitarian aspect of the refugee question.

Fintech and Blockchain As Refugees’ Hope Amidst Growing Global Crisis

As the global displacement crisis escalates, fintech and blockchain technologies are offering innovative solutions to aid those forcibly displaced.

These technologies offer unique opportunities to address the challenges faced by displaced populations, such as lack of access to financial services, identity verification, and secure transactions.

Fintech innovations can provide refugees with access to essential financial services, such as mobile banking, microloans, and digital wallets, which are critical for rebuilding their lives. Blockchain technology, on the other hand, can offer secure and transparent systems for identity verification and aid distribution, ensuring that resources reach the intended recipients without the risk of fraud or corruption.

UNHCR, Cardano Foundation Lead the Way in Solving Refugee Crisis

As of 2024, approximately 130 million people are forcibly displaced globally , with the number expected to reach 150 million by year-end. The UNHCR is responsible for aiding and protecting these populations, a task that is becoming increasingly complex. Their strategy includes cash-based interventions to allow refugees to meet their own needs with dignity. However, delivering this aid effectively and securely remains a major challenge, especially in regions with unstable financial systems.

The  CEO of the Cardano Foundation, Frederik Gregaard highlighted how blockchain technology can help address challenges faced by refugees, particularly in identity verification. For refugees who often lose their identification documents, blockchain offers a secure, decentralized method to prove their identity.

Greegard previously told CCN that this capability is vital for accessing services and integrating into new countries. Gregaard points out that the immutable nature of blockchain ensures that identity records are permanent and cannot be altered, which is crucial in situations where power imbalances could allow for manipulation of identity verification. With a decentralized identity system, blockchain not only empowers refugees by providing autonomy but also enhances their security.

The growing refugee crisis urgently requires innovative solutions, and leveraging blockchain and fintech is proving pivotal. Organizations like the UNHCR and the Cardano Foundation are at the forefront, developing more efficient, secure, and empowering systems for aid delivery. These technologies not only facilitate immediate relief but also promote long-term resilience and self-reliance among displaced populations. This strategic use of advanced technologies paves the way for sustainable support mechanisms that enhance the autonomy and safety of refugees worldwide.

Blockchain Enhances Social Inclusion for Refugees, Says Elevandi Exec

About the blockchain and how it is enhancing social inclusion, CCN spoke with Pat Patel , Executive Director of Elevandi, an organization by the Monetary Authority of Singapore.

Answering the question about how emerging technologies like blockchain enhance social inclusion, especially in the context of high EU asylum applications , Patel pointed out that traditional systems often fail to provide transparent, secure, and efficient support for these individuals.

He stated:

“Blockchain can address these issues by enabling secure digital identities, ensuring that asylum seekers have a verifiable and portable way to prove their identity. This is crucial for accessing services, securing employment, and integrating into new communities.”

He furthermore explained that blockchain can also streamline the process of financial inclusion , allowing refugees to open bank accounts, receive wages, and safeguard savings without the barriers posed by traditional banking systems.

“By providing these fundamental services, blockchain helps refugees rebuild their lives with dignity and autonomy.”

Tackling Challenges in Implementing Tech-Based Solutions for Displaced Populations

When talking about the biggest challenges he faces in advocating for and implementing technology-based solutions, Patel said it is mostly “inertia, perceived risks and resistance to change”.

Patel explained that many organizations  and stakeholders are accustomed to traditional methods and may be skeptical about the effectiveness and security of new technologies like blockchain. He also noted that there are technological and infrastructure barriers, particularly in regions with limited internet access and less developed digital literacy.

Overcoming these barriers will, according to him, necessitate significant investments in education and the implementation of clear scalability measures. However, he believes it will be worthwhile if it enables effective onboarding of the masses through a unified and interoperable approach.

As the executive director of a not-for-profit organization, he is focused on aligning policy roadmaps across jurisdictions with technology roadmaps and responsible innovation. At the Point Zero Forum, he talked about assisting businesses in navigating these regulations, ensuring compliance, and fostering collaboration on frameworks that enable rather than hinder progress.

He added:

“Our annual symposium is a meeting of the minds for some of the world’s best and brightest in tech, finance, policy, regulation, and law. By curating a platform for these discussions, we are looking to effect real change in the long term so that everyone has a chance to be a part of a safe, regulated, and sustainable digital economy.”

Be it as it may, the growing refugee crisis urgently requires innovative solutions, and leveraging blockchain and fintech is proving pivotal. Organizations like the UNHCR, Elevandi and the Cardano Foundation are at the forefront, developing more efficient, secure, and empowering systems for aid delivery.

These technologies not only facilitate immediate relief but also promote long-term resilience and self-reliance among displaced populations. This strategic use of advanced technologies paves the way for sustainable support mechanisms that enhance the autonomy and safety of refugees worldwide.

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