Context:
Cash aid-based social protection programs, which are responsible for dispersing nearly $152.8 billion in aid to millions of people in need in 2019 alone, continue to be heavily reliant on applications like Microsoft Excel, wire transfers, and checks, to manage and disburse aid. Aid administration conducted with such antiquated methods makes compliance a constant fear, financial audits incredibly onerous, costs high, and accountability virtually non-existent. To this day, it remains close to impossible to trace individual contributions — either online or by simply dropping change into a contribution box — to the programmes in which they are spent. The inefficiencies of humanitarian aid delivery are costly. High administrative costs and low lead teams means that less aid ends up where it is crucially needed.
Challenges
Lack of transparency: Antiquated technologies and centralized systems makes tracking transfers from donor to beneficiary slow and inaccurate. This introduces opportunities for fraud and graft.
Faster, real-time reconciliation. Transactions are recorded in real-time, automatically on the blockchain. This allows for fast payment finality and real-time analytics that current systems do not provide.
High operating costs. Financial intermediaries charge large fees for cross border transfers and payments to individuals, diverting much needed aid from the end beneficiaries.
How Celo helps
Celo offers a transparent, low cost, and user friendly solution to deliver humanitarian aid to those in need. Because of Celo's mobile first approach and user-friendly technology, Celo is the blockchain of choice for major NGOs such as the World Food Program, Oxfam, GiveDirectly, Care International.
Benefits of Using Celo
Lower operating costs. Unlike centralized systems, there are no financial intermediaries that need to make profit through transaction fees. With Celo, you can send a transfer to any phone number in the world for as low as fractions of a penny.
Greater transparency and traceability. Transactions are recorded on an immutable ledger, making it extremely easy to trace funds from their origin to intended recipients. No person has the authority to edit the ledger and the record is open and easily auditable.
Flexibility and customizability: Celo is an open protocol that is fully compatible with Ethereum. With a wide range of tools, anyone can develop third party applications (dApps) on the platform. Currently there are over 200 teams building solutions for everything from decentralized finance, travel booking, payments, and more.
Immediate Syncing Even on Slow Connections: Extremely fast, secure synchronization between mobile devices and the Celo network means that even Valora users with high latency, low bandwidth, or high-cost data tariffs can use Celo. Celo removes the need to check every header before a received header can be trusted. Performance is further improved with BLS signature aggregation and succinct zero-knowledge proofs, via zk-SNARKs.
Accounts Linked to Phone Numbers: Celo maintains a secure decentralized mapping of phone numbers that allow wallet users to send and receive payments with their existing contacts and with confidence that the payment will reach the intended recipient. This abstracts away part of the complexity of using blockchain technology – users no longer need to know a recipient’s public address to transfer funds.
Scalability. Because the platform is not reliant on a single financial service provider, the Celo platform can be used by any agency to distribute digital value to recipients from anywhere in the world. This makes it easy to scale Celo across geographies or to use as a tool to coordinate among different organizations.
Case Study:
- How the Grameen Foundation Successfully Delivered Humanitarian Aid to 3,500 Micro Entrepreneurs Using Celo’s Blockchain
- Delivering Humanitarian Aid Transparently Philippines program highlights crypto’s potential to reduce fraud
- Delivering Humanitarian COVID Aid using the Celo Platform