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- The Stellar Development Foundation released a detailed financial inclusion framework after conducting the importance of blockchain technology in Columbia, Argentina, Kenya, and the Philippines.
- The framework provided several insights into the major market gaps and the role of blockchain technology in facilitating seamless payments both locally and at the international level.
The mainstream adoption of the Web3 industry is expected to take place in the coming few years as traditional finance institutions push to survive in a dynamic market. The Stellar Development Foundation has published a detailed framework that entails what web3 startups need to do to capture emerging markets.
Moreover, the traditional finance infrastructure has for years taken its customers for a ride with high transaction fees and a slow processing speed that is prone to error. As a result, both retail and established enterprises have been using alternative payment solutions that tap into digital assets and blockchain technology.
Stellar Development Foundation on Enhancing the Social Handprint of Financial Service Providers
According to the Stellar Development Foundation, the company behind the Stellar Lumens (XLM) network, blockchain technology is a key integral part of fostering financial inclusion, especially in undeveloped countries. Furthermore, most traditional finance institutions in developing nations have over the years marginalized the lower income earners, with a high rate of unbacked individuals.
Notably, the Stellar Development Foundation published a method for judging the effectiveness of web3 projects in emerging markets, whereby the study focused on Kenya, the Philippines, Columbia, and Argentina. The framework was developed in cooperation with consultants PricewaterhouseCoopers International (PwC).
“Financial service providers can use our global financial inclusion framework to assess and improve their social handprint. The value parameters identified within the Framework –categorized along the dimensions of access, quality, trust, and usage – help determine a solution’s ability to foster financial inclusion,” the report noted.
Notably, the framework provided by the Stellar Development Foundation provides a methodology to assess the capabilities of a financial solution to serve the needs of the financially underserved population. Interestingly, the report found out that the digital wallet solutions across the four countries had no cost to open, run, or maintain.
The report concluded that the web3 industry players have to promote regular education to the stakeholders on the specific ways in which public blockchains can be used to promote financial inclusion.
What Stellar Network Is Doing to Enhance Financial Inclusion at a Global Scale
The Stellar network through its blockchain products has significantly helped serve the unbanked people around the world. For instance, XLM is readily accessible on almost all top-rated crypto wallets and traded on popular exchanges.
Additionally, Stellar Network has partnered with an aid organization to facilitate the distribution of funds to the affected Ukrainians. Notably, the Stellar network has been working with other financial institutions including MoneyGram to enhance seamless off and on-ramping to the digital asset realm. Worth noting that the Stellar network is working with other web3-focused companies like Circle, the issuer of USDC, to facilitate easy and secure access to crypto investors.
