The use of blockchain will go a long way in fostering the work of charities and other donors. Using the blockchain ledgers to track the transactions and also having the charity organizations showing time or date stamped photographic proof of supplies or aid delivered, the donation process will be far more transparent and efficient. One other problem plaguing NGOs is that there are lot of middlemen who handle the money before it reaches the intended recipients. For example, money coming from German funders to a Zimbabwe based NGO has to go through the German banks who take a portion of the wired funds, the Reserve Bank of Zimbabwe for clearance as well as the NGO’s local bank in Zimbabwe. This local bank also has an upper hand in deciding the exchange rate at which this money will be converted to the local currency. Such a rate usually favours the bank as it has to make a profit in addition to the bank fees and commissions it will have charged on the transactions. Overally, this increases the transaction costs and negatively affect the budgets of local NGOs. Also in the process of having to go through some bureaucratic banking procedures time is lost along the way. This may also impact upon the nature of an organisation’s programming and may also strain the relations between the funding partners and the grantees as both financial and narrative reports may not be availed in time to the funding partner.

The use of a blockchain app like Humaniq, that can put donors directly in connection with the organizations and individuals contributing towards meaningful change on the ground, can get rid of structural and non-value adding bureaucratic processes. Humanitarian organisations such as World Vision embarking on Area Development Programmes (ADP) may also make use of block chains to increase the impact of their work. For example, if it decides to construct a road in a rural area in Nepal, it can use blockchain technology to track how each dollar is spent, identify all the users of the funds and ensure that all expenditure is within the agreed upon budgets and limits.

By adopting blockchain technology aid providers will able to provide aid far more efficiently than they ever could in the past. This is so because there will be reduction or elimination of wasteful practices that currently undermine the efforts of charitable organisations to make positive social impact. At the same time funds recipients will also ensure that their transactions are carried out efficiently, effectively, economically and equitably in order to positively impact upon their communities or constituencies.

 

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