Blockchain-based Chama
Blockchain-based Chama
technology application

Blockchain-based Chama

1
domains
8
stories
8
SDGs
updatedMar 26, 2021
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sdecoret @ sdecoret

Chamas are informal community-based micro-finance groups designed to extend financial assistance to economically vulnerable social groups. When based on the blockchain, this service provides accountability, security and reduces fraud.
Chamas are informal community-based micro-finance groups designed to extend financial assistance to economically vulnerable social groups. When based on the blockchain, this service provides accountability, security and reduces fraud.

Chamas are informal social savings groups that allow members to contribute a certain amount of money, take loans at low-interest rates, earn dividends, and make investments on a monthly basis. Chama structures revolve around periodic group meetings when transactions occur using fiat money, and record-keeping is paper-based and subject to flaws. Currently, projects use a blockchain platform to provide distributed and trustworthy record-sharing, which is kept digitally, securely, and open. Members of a Chama have the same set of records, which are validated by other members through consensus and allow for remote meetings. While transactions are still based on fiat currencies, a next step would be including cryptocurrencies in the solution.

Gender Equality

Challenges

  • This technology may still face access issues from vulnerable groups if it does not have an inclusive user-friendly interface that accounts for illiterate people, for example.

  • As blockchain technology ordinarily depends on an internet connection, people with more limited access to the web may encounter more difficulties.

Opportunities

  • Increase the financial turnover of women-led and project-assisted enterprises.

  • It promotes a safe place to save and store humanitarian cash transfers and remittances.

  • It may help solve social issues that disproportionately impact women and girls, by creating funds with a robust approach to gender equity and diversity, or by using a gender lens to identify potential risks and opportunities in the value chain.

Related Content

8 stories
5 organizations
1 technology domains
1 industries
  • Finance
5 topics
  • Decentralization & Local Governance
  • Digital Economy
  • Anti-Corruption & Standards of Integrity
  • Gender Equality
  • Inclusive Finance
8 SDGs
  • 01 No Poverty
  • 02 Zero Hunger
  • 05 Gender Equality
  • 08 Decent Work and Economic Growth
  • 10 Reduce inequalities
  • 11 Sustainable Cities and Communities
  • 16 Peace, Justice, and Strong Institutions
  • 17 Partnerships for the Goals