Blockchain Uses for Microfinance Institutions in the Water and Sanitation Sector: Pilot Study

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Pflueger, Caroline;
Campbell, Tyler
May 2021
Nalesso, Mauro; Sasaki, Keisuke; Garcia, L. Javier
Microfinance Institutions (MFIs) are organizations that provide small loans to borrowers who typically lack collateral, steady employment, or a verifiable credit history and therefore do not have access to traditional commercial banking. Blockchain technology could be used to create a more holistic view of the financial position of a potential borrower, which could result in better lending decisions. This study explores how blockchain technology has the potential to assist Microfinance Institutions in the water and sanitation sector through a pilot project developed in Peru. The improvements seen in the existing microfinance ecosystem during the implementation of the blockchain platform can be sorted into two main groups: improved institutional performance, and data ownership for the individuals.