SEATTLE, Washington — Experts believe that access to financial services such as bank accounts and credit is an important part of helping the world’s poor lift themselves out of poverty. Those who sell raw materials into the global supply chain are often left with little evidence of their participation in the supply chain. Without adequate documentation and proof of their existence, they are often deemed unbankable by financial institutions. The innovative software company, BanQu, works to make the world’s unbankable bankable.
The Importance of Access to Financial Services
Access to financial services has been recognized as one of the most important factors in eradicating global poverty. Globally, around 69% of adults have access to a bank account. Having access to financial services is important for a number of reasons. Without access to banking services, underbanked and unbanked people across the globe are severely limited in their ability to start businesses, create jobs and access opportunities for learning and education.
The rise in availability of smartphones, social networking and applications like M-Pesa, has led to a global increase in the number of people who have access to banking. Despite improvements in the number of people who are able to access financial services worldwide, women are a population disproportionately impacted by being unbanked. Women make up more than half of the global unbanked population at 55%. While the number of adults with a bank account globally rose 7% between 2014 and 2017, the disparities in percentages between men and women have remained unchanged since 2011. Around the world, women are 9% less likely to have access to a bank account than men.
The innovative software company, BanQu, is using technology to aid those who sell their goods into the supply chain in becoming more visible. All companies who are manufacturing goods start its process by procuring raw materials such as coffee, cobalt and cacao. These raw materials are typically sourced from farmers in poor nations. The farmers who are selling their goods into the supply chain are often left without evidence of their participation in these transactions. Without evidence of their existence in the supply chain, these farmers frequently face difficulties when it comes to opening bank accounts.
In 2014, BanQu’s founder and CEO, Ashish Gadnis, was USAID’s volunteer chief of poverty in the Democratic Republic of Congo. During the two years he served in that position, he was able to get to know the community and the farmers well. Gadnis told The Borgen Project that many of the people he worked with were invisible in the sense that they did not have a bank account or access to good credit. It wasn’t until he witnessed a woman trying to open a bank account in Congo, that he realized what the root of the issue was. The only evidence of her existence in the supply chain was a paper receipt. Past the paper receipt, there was no evidence of the transaction or her existence at the end of the supply chain. She was essentially invisible, which made her unbankable. The bank would not accept her receipt as proof and denied her the ability to open an account. Her story is not uncommon for small farmers, recyclers and other workers who sell their goods to big brands. BanQu’s solution is to use blockchain technology to create a digital footprint and identity for these farmers that is based on dignity.
How BanQu Works
BanQu’s platform was created with ease of use in mind. The software platform, BanQu, is extremely straightforward and easy to use for both suppliers and buyers. Every worker, farmer and miner who sells their goods into the supply chain is registered with BanQu using their full name, cell phone and identification card. BanQu is built as a software service that runs across platforms such as Amazon, Google and Microsoft. Every time a farmer sells their goods to an aggregator, they immediately receive communication, often through SMS, confirming the number of crops they are selling and the amount they will be paid for it. All communication comes to farmers in their native language and there is no training required for them to start using BanQu. Cellphones are a critical piece of ensuring that all farmers and workers, particularly women, are paid for their work. Gadnis says that cellphones are important for farmers that are women, from a gender equality perspective, so that the money goes straight to the woman and does not have to go to a man.
When users get paid, they are paid in their native currency. No cryptocurrency is involved in any of the transactions made through the service. When users decide to cash out, they have three options: cash out, get a direct deposit to an M-Pesa account or get a direct deposit to their bank account. Once the user cashes out, they are sent a message via SMS with proof of the transaction. The platform also provides businesses with transparency throughout their entire supply chain. Every aspect of the supply chain becomes traceable with digital receipts. If the company is wondering how much of a certain crop they purchased that day, they are able to look at the amounts, quality and whether or not the farmers have been paid.
BanQu’s Success Stories
BanQu’s services help poor workers and farmers in more than 40 nations prove their existence and involvement in the supply chain. Perhaps most importantly, the service has helped to economically empower women. On the Zambia-Congo border, women are now running their own businesses and are able to borrow money with much lower interest rates as a result of becoming bankable. They are also able to put their children into schools and start their own co-ops with other local farmers.
At the beginning of worldwide COVID-19 lockdowns, BanQu launched its services across four cities in Columbia. Many of the waste pickers and recyclers local to those areas were out of work and we beginning to lose their livelihoods. As a result of the partnership between AB InBev and BanQu, waste pickers were guaranteed 50 pesos per bottle they were able to bring back to the recycling center.
Through being able to prove their existence in the supply chain, the workers, miners and farmers are able to reap a variety of benefits. “They’re getting mobile banking, they get better seed input and most importantly, they have created this economic resilience that is not tied in pity,” says Gadnis. The heightened visibility of these workers in the global supply chain assists them in not only becoming more active participants in the global economy but also in being able to get out of extreme poverty. “The big win is that people own their economic passport, which is kind of what that BanQu dream was to start with.”
The Future of BanQu
Looking into the future, the software company, BanQu, hopes to see its annual revenue grow to $100 million by 2023. While this may seem like a lofty goal, the company’s revenue has grown rapidly. Only a year after the company started, BanQu’s revenue was $100,000 and it was connected to 3000 people. In just three short years, BanQu’s annual recurring revenue and number of users have seen massive growth. In 2020, BanQu’s annual recurring revenue was predicted to be between $3 million and $4 million with more than 500,000 people using the service. Those 500,000 people who are using the service are the farmers, recyclers, miners and workers who were previously invisible at the end of the global supply chain.
Helping the world’s poor become bankable is a crucial step in alleviating global poverty. With its rapid growth and a strong commitment to helping farmers and workers become visible, the software company, BanQu, is empowering hundreds of thousands of people in the global supply chain.
– Maddi Miller