Humanitarian Aid More Efficient with Blockchain

According to the 2018 Ditigal Trends report published by G2 Crowd, one of the biggest problems for refugees and displaced persons is identity loss. Without an identity, it is impossible to get access to services. Aid groups have begun using blockchain to give displaced persons their identities.

Some groups have gone further: the Finnish government distributes blockchain-backed debit card to asylum seekers. Refugees can use those cards at participating stores, and the cards also verify their identities. Similarly, the World Food Program uses an eye scan programme to let people buy groceries in Jordan.

Digital Journal interviewed Michael Fauscette, CRO of G2 Crowd about the report. “Blockchain is the first method/platform to combine several important features, yet do it in a way that is transparent, very secure and applicable across a rapidly growing number of use cases,” he said. He added that the blockchain system removes the middlemen, can be completely autonomous, and keeps permanent records of all transactions.

Fauscette views possibilities for blockchain to help the displaced persons as unlimited and invaluable. “In a civilized world the government of wherever you happen to live provides proof of your identity in several forms. That, however, is not the case in many countries, where the ability to have and carry absolute proof of identity is difficult to impossible,” he says. “But enter your credentials into a blockchain and with a hash at the border (or anywhere) you can retrieve your proof. This works with financial transactions of course, like Bitcoin, but it can work for resumes - education, certifications, employment history, skills etc. - or medical records, or real estate transactions…the list is huge.”

The Red Cross is also looking at this technology in its “humanitarian passport” project for volunteers, which seeks to develop a blockchain-based passport to keep a person’s full history of their humanitarian work and allow them to cut through the red tape with a one-step verification tool. Ideally, the passport would save time lost on identity verification in situations when volunteers have to be deployed to a critical mission.

One of the biggest advantages of blockchain, says Fauscette, is that the design of the system is inherently extremely secure, and the system is very transparent. And while there is a theoretical risk of cyber attacks to any system connected to the Internet, the design of the blockchain makes it much more secure than other existing systems.

Large non-profits are hopping on the blockchain transparency train in an effort to boost tracking the millions they collect in donations, fight fraud and increase accountability.

For Red Cross Australia, US $6 million worth of Ebola aid donations were lost to corruption during the Ebola crisis in 2014-2016, the Associated Press reported. Having received more than AU $87 million in donations in 2017, the agency is now experimenting with crypto-donation technology to be more accountable to their donors. The reasoning is simple: by using cryptocurrencies to donate, people can then track how their money is being used by the nonprofits, and for what causes.

If the experiment is successful, Red Cross will launch the project on a larger scale. Red Cross has partnered with Horizon State, a startup that focuses on building community empowerment platforms and believes in blockchain as an efficient tool to increase transparency and accountability.

“The transparency and security inherent to the blockchain technology provides a level of trust that is sometimes missing with traditional methods of donating,” says Nimo Naamani, co-founder of Horizon State. “With crypto-donations, a donor can know exactly how much of their donation the intended recipient received, and how much was used as operational costs or commission off the top.”

Why is this important? Because in some cases, up to 40% of donations are spent covering the agency’s overhead costs. And that is something people making donations want to know.

Among other nonprofits using blockchain is the World Wildlife Fund-Australia, which is tracking fish with a tag and QR code to ensure transparency in the food supply chain. This is meant to tackle the fraud in the fishing industry, from producers under-declaring their catch, or covering up illegal fishing practices.

The Paris Agreement in another example of blockchain use in the nonprofit worlds. The Blockchain for Climate Change Foundation aims to track carbon emissions on a blockchain system, with participating nations declaring the exact amount of carbon they produce.

Increasing collaboration between the tech sector – and those involved in blockchain technologies in particular - and the nonprofits is a promising new approach to the way charity is done: with more transparency and accountability.