Why Blockchain?

What is Blockchain?
Blockchains are distributed ledgers or shared databases in which data is stored as blocks on a network in real-time. When a block of data or information is recorded onto the blockchain by any user, this data is instantly and automatically duplicated onto all the other computers on the network. All participants on the network are given equal status to submit, review and verify the records. When the block of data is distributed across the whole network, every user sees the most up to date information. This sort of distribution of information makes blockchain a powerful and efficient tool for storing and sharing information across multiple organisations in real-time. The key feature of the blockchain or distributed ledger technology (DLT) is that the blocks of data are immutable, making it impossible for any user to amend, delete or duplicate a single entry on the network without it being noticed.

Challenges blockchain is able to address

It is estimated that more than half of the money sent as cross border remittances moves via informal channels. Sending money is still expensive, slow, and unsafe when using most of the options available in these informal methods. The formal channels which are mostly paper-based, and depend on centralised transaction processing, messaging and reconciliation systems are also very slow and expensive.
In the Southern Africa region, South Africa is the biggest source of remittances. Money in the region mostly moves through informal means due to the proximity of the countries in the region, cross border traffic and legacy issues. The informal systems are well established and generally, people are still cash-based in their dealings. As such cash happens to be the biggest competitor of any digital based initiative.    

Financial inclusion

Underserved individuals, entrepreneurs, and SME business owners and ultimately the governments benefit from everyone being included in the formal economy.

 Individuals are constantly looking for more convenient, secure ways to accumulate, hold and transfer value. Solutions based on the Distributed ledger technology (DLT) can help families to access financial services such as savings, loans and insurance. Digital inclusion lowers the cost and time usually involved in sending and receiving money, as well as paying recurring bills.

Digital inclusion through the DLT also allows entrepreneurs and SME’s that have innovative ideas to operate in mature, global markets. Gaining access to financial services ultimately empowers them to expand their business and create more jobs and attain economic prosperity.

Governments stand to benefit when citizens are connected. There is an increase in the velocity of money and economic activity. Digital inclusion increases transparency, security and enhances regulatory oversight. Issues such as corruption and tax evasion can be reduced through technologies like the DLT.

Use cases of Blockchain

Know your customer (KYC)
One of the barriers to entry into financial services has been regulations surrounding customer identification. Customer onboarding is being modernised, some financial institutions have started introducing electronic Know Your Customer (eKYC) initiatives which have significantly increased inclusion of the once marginalised demographic. There are already solutions that have been introduced that enable ‘Proof of existence’ through blockchain-backed platforms that certify a user’s KYC related information. Some go further to enable distributed vetting whereupon a user provides contacts details for five other people that can verify the information they would have provided.


Solutions are available that enable small scale farmers to create a unique digital profile or economic identity by inputting data such as their photos, date of birth and other details which are stored on the blockchain with immutable characteristics. The farmers’ peers can then be added to be able to verify the information digitally. Peers will be able to authenticate personal and transactional processes e.g. cash disbursements, health records, credit histories etc. 

The biggest use case for the technology is for cross border transactions. The ubiquitous proliferation of mobile devices over the last few years has enabled customers to demand out of bank services which offer convenience to transact from the comfort of their homes.

The distributed ledger technology is introducing an era of disintermediation, leading to an open, decentralised, and inclusive financial ecosystem with unprecedented capabilities of creating, transferring and exchanging value.

Previously marginalised people will be able to access quality financial services via this technology.  The headache of customer identification or Know your client is addressed through the introduction of federated identity solutions which are cryptographically sealed on a distributed ledger. DLT offers a faster, clearing and settlement infrastructure for transactions which in turn reduces cost, improves efficiency and enhances security.


Institutions such as Uhuru innovative solutions have taken the necessary steps to pave the way for the introduction of DLT based solutions in the countries under the Southern African Development (SADC) region. Through the use of other enabling technologies such as cloud computing, machine learning and artificial intelligence, Uhuru will offer financial services such as payments services, savings, credit, and insurance services to previously unbanked and underbanked immigrants within the region. Ultimately, the technology is borderless and can be utilised globally to afford Africans that have left their home countries to still be able to access the financial services of those countries from abroad.