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December 11, 2017
Blockchain's humanitarian potential
By: Sanjay Podder

We all know about the global revolution that blockchain and other distributed ledger technologies are sparking. In the ten years since the idea of blockchain first emerged, the worlds of commerce and finance have been bracing themselves for the transformative effects of allowing parties to transact securely without the need for a central authority to validate their interactions. And those effects are now starting to bite across industries. Bitcoin is just the most famous example to date.

But blockchain could revolutionize humanitarian and social organizations too – both in how they operate, and in what they can achieve. How? First, by improving accountability and reducing fraud through real-time transparency across an entire value chain. Second, by reducing costs and wastage and enabling the value chain to transact and share information with an unprecedented degree of trust and auditability. These benefits bring multiplier effects: engendering new levels of public confidence in an organization’s capabilities and giving it a better story to tell potential donors and new recruits.

Many humanitarian and socially-minded organizations are already thinking about how blockchain might be used for social good. And they’re finding use cases in a whole range of areas. These include resolving land-registration disputes in Ghana (Bitland), drastically reducing the cost of remittances in Kenya (BitPesa), combatting fraud in humanitarian aid and charitable donations (Aid:Tech and Hypergive), and helping the more than a billion people around the world today who lack adequate proof of identity (ID2020, supported by Accenture and Microsoft).

Some organizations are also unleashing huge efficiencies from using the technology. For example, Akshaya Patra – the world’s largest non-profit supplier of school meals – has trialed blockchain in its kitchens as part of a wider IoT and artificial intelligence pilot. It estimates this combination of technologies could bring savings of up to INR 30 million if extended across more of its kitchens.

But, exciting as these programs undoubtedly are, most of them are still at the pilot stage. To realize blockchain’s full potential, humanitarian organizations need to scale up their use of the technology. That means focusing on the long-term vision and looking to align the entire value chain with that vision in a completely transparent way. Then, thinking innovatively about the funding and talent needs that blockchain brings. Whether that means working with experienced industry players, using open-source solutions to bring down costs, or even building a proprietary blockchain solution and offering it as a service to others, there are numerous options.

Finally, they need to understand the importance of the feedback loop throughout their ecosystems, and how blockchain can enhance it to provide a critical boost to effective decision making. For example, the real-time feedback captured by Akshaya Patra’s blockchain pilot not only helps them track critical outcomes, such as whether food is delivered on time, but also helps them predict the next day’s meal requirements.

In the end, humanitarian organizations operate on trust. And that’s why blockchain’s capacity to build new levels of trust within an ecosystem makes it such a potentially transformative technology for social good.

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