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Wednesday 28 November 2018 22:48
Of BITANGE NDEMO
IIn a quiet suburb of South C of Nairobi, last week, we sat down to listen to perhaps the first deployment of Blockchain Kenya for humanitarian activities in northern Kenya by the Red Cross Society of Kenya (KRCS).
For the KRCS team, it was just another new innovation in their journey from virtual bankruptcy to the current state where many business schools are interested in the company's remarkable turnaround.
They were the first to build a social enterprise in hospitality and ambulance services to support their humanitarian activities. Their latest investment in technology is destined to dramatically improve efficiency.
In May of this year, KRCS joined its counterparts, the International Federation of the Red Cross Society (IFRCS), to conduct a pilot project Blockchain open-Loop Cash Transfer in the county of Isiolo.
Their goal was to understand the potential of Blockchain technology for transparency and accountability, which are indispensable in humanitarian activities.
Although Blockchain has been used in other places as in Syria, the Isiolo project was unique in its kind. Earlier use cases concerned mostly closed-loop payment mechanisms such as e-vouchers, where payments are linked to specific merchant outlets. The advantage of an open-cycle model is such that aid can be delivered promptly.
In addition to IFRCS, there were other local partners who completed this project. They were: RedRose, which provided the cash data management platform; Craft Silicon who was the M-Pesa API integrator; and Safaricom who were the financial services provider.
KRCS, after registering the beneficiaries, provided the necessary data which was then uploaded to the RedRose data management system. This seemingly complex process used a standard solution and leveraged its native algorithm to protect transaction data with cryptography to provide an immutable (indelible) digital ledger.
This allowed three organizations, namely KRCS, IFRCS and RedRose, to share similar data simultaneously and in the process of promoting transparency and accountability.
The pilot was made in such a way that limited information on the beneficiaries was registered on Blockchain in order to protect their privacy, but the system gave all the interested parties the power over the data that can not be changed anywhere without let's know what's going on.
And if someone wanted to change the information, the previous data remain unchanged.
The results of this project have confirmed the promise of use cases for Blockchain. In terms of efficiency, it emerged that only a fraction of the cost was sustained compared to previous similar interventions.
The system was effective in that it took the shortest time to deliver resources, confirm the transaction and reconcile KRCS books at the touch of a button.
Perhaps the best of the findings is the ability of the system to offer auditors an independent way of verifying a compiled list of transactions against records provided by audited subjects.
The ability to increase emergency activities did not require further investment, as often happens when emergencies increase.
Blockchain technology, especially now that the report by Distributed Ledgers and the Government's Artificial Intelligence has come out, gives hope that the relationship will be fully implemented.
Some infrastructural interventions will be necessary for a correct implementation. The introduction of high-speed broadband across the country will be crucial because there will be many other applications that will benefit from the technology.
Some of the innovations will require new laws and regulations and since innovation precedes regulation, the government will have to facilitate progress through some legal sandboxes.
