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Source: Mercy Corps - FinX
Context
Online work has the potential to be a powerful tool for poverty alleviation for many of the most vulnerable communities around the world. However, there are several challenges that prevent the industry from achieving maximum potential, including limitations on effectively delivering payments to workers upon completion of tasks.
Microwork is a subset of online work and is typically characterized by work where complex projects are broken into basic ‘microtasks’ that can be completed in seconds or minutes without much training or specialized skill required. Workers are typically paid in small amounts and the barriers to entry are lower than other types of online work such as online freelancing. Some common examples of microwork include image tagging, text transcription, data entry, etc.
The microwork industry is relatively young and fast growing. In 2017 microwork accounted for $400M in global revenue and employed approximately 1 million people. The AI market is projected to grow to $191B by 2025, of which Data Labelling is expected to account for $19B.
Challenges
- High transaction costs. Payments for microwork tend to be very small (e.g. $.08 per task). Most platforms institute minimum cash-out amounts ($5 - 20) because there are fixed costs involved with distributing payment. Even with minimum cash outs, middlemen and high fees take a huge chunk out of the total payment.
- Long lead times and payment cycles . Distributions can take a long time because of lags with financial service providers and because workers must meet certain disbursement minimums.
- Poor financial payment options. There are several places with strong demand for microwork but no major financial service provider to facilitate payment.
- Financial exclusion. Many groups are unable to participate in microwork because they lack appropriate identification or access to financial services.
How Celo Helps
Celo has the potential to meaningfully improve the payment experience by reducing the reliance on financial service providers, reducing costs, improving disbursement speeds, and increasing transparency.
Benefits
- Low-cost global transactions. Transactions to any phone number in the world for a fraction of a penny - much lower than alternative solutions.
- Immediate transactions. Send money globally in under 10 seconds, while traditional alternatives can take hours (and occasionally weeks)
- Financial access with just a phone number. All you need is a phone number and cell phone in order to send, receive, and save in Celo - making it a lot easier for people in communities where access to formal bank accounts is difficult.
- On-off Ramps: There are a host of cash-in and cash-out options around the world. The list of supported merchants and partners continues to grow and includes merchants, cryptocurrency exchanges, mobile money operators and more.
Case study
Mercy Corps, Appen, Corsali, Kotani Pay, create a solution that connects low income workers in Kenya with artificial intelligence microwork tasks from around the world with the payment infrastructure built on Celo.
[Full Report to come in June 2021]
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