Informal credit, i.e. using IOUs instead of cash, is widely used in developing countries to overcome money scarcity. SikobaPay provides the technology to make informal credit much more effective:
Because debt is registered on a blockchain, users obtain legal certainty;
Users can transact beyond their immediate circle of trust, as SikobaPay identifies trusted intermediaries;
SikobaPay automatically clears circular debt, thus reducing the need for cash settlement.
We plan to release our MVP at the end of March 2020.
Credit conversion allows SikobaPay users who do not know or trust each other transact using IOUs through trusted intermediaries. Sikoba’s basic and most important rule is that a user will only ever have credit exposure to those they have expressly chosen to trust.
Take a look at how this works.
Clearing - Disappearing Debts
Clearing — the same tallying and offsetting of debts and credits that was historically done at village fairs and trade fairs — but on a more rapid and ongoing basis. The result is that money is only needed to repay residual balances rather than the full financial value of all trade. Therefore, much less money is needed for the same volume of trade.
Take a look at how it works.