Blockchain And First Aid

One of the more disheartening aspects of aid – and there are many – is the knowledge that a large portion of the donations don’t get to where they should.

Apart from the layers of bureaucracy and transfer costs, there’s the price of corruption, leading to leakage all along the chain. According to former UN General Secretary Ban Ki-moon, as much as 30% of all development aid does not reach its destination.

In response, charitable organizations around the world are turning to blockchain technology. This shift will affect not only the delivery of the aid, it is also likely to have a significant impact on the beginning of the chain – the donations themselves.

First aid

This past week, a UK-based network of national and international aid agencies announced a trial with Disberse, a blockchain startup that aims to improve the transfer and traceability of donated funds.

Similar projects around the world are also under way. For instance, the World Food Programme recently trialled a blockchain-based method of distributing aid to refugees in Jordan, and earlier this year, the United Nations put out a call for blockchain startups to help it improve systems and develop new processes.

Several startups are working on ways to, among other things, expedite aid transfers and improve efficiency.

While the cost savings afforded by more efficient payment rails is a valuable advantage when it comes to donations, increasing attention is being paid to the transparency aspect of the technology. With the opacity of many distribution networks obfuscating the destination and quantities of contributed funds, a clearer vision of flows and impact would enable errors to be corrected and would hold participants more accountable.

With greater transparency comes greater trust that funds reach their intended recipients intact, which could encourage donors to give more.

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