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Trust in supply chains can be a difficult thing to achieve. It is imperative to get them to work, but it can be difficult to establish because much of how things actually move from point A to point B can be frustratingly opaque.
This pressure, he noted, has inspired the new partnership that Mastercard and GrainChain announce today to link GrainChain’s agricultural supply chain technology solution to Mastercard’s proprietary blockchain technology to build a more inclusive and productive agricultural supply chain worldwide. .
“The way we see this all materialize is that the experience of the partnership industry that has combined GrainChain’s expertise in charting the historically underserved agricultural segment with the powerful global scale of our backend, and what it does is create trust between parties where trust is inherently complicated today because people don’t necessarily want to share their information or don’t have a way to share information with each other. We can empower that sharing in a pretty magical way, “Barta said.
For smallholder farmers and producers at the far end of the supply chain, who gets paid fairly and gets the best possible price is not just a matter of successful business, but a literal matter of life and death. What they sell today, Macias noted, is what buys the food they will eat and feed their families tomorrow. If they can’t get paid on time, or their buyer decides to pay less than the contract because the goods don’t seem right when delivered, those farmers don’t have many resources in the developing world. They can be paid late, he noted, or go hungry.
But GrainChain can inject transparency into the process, which means the farmer has literal and presentable proof of the quality of his produce from harvest to delivery. It means they will be paid more and in a more timely manner.
“We see it every day. We are in the field and our systems are in the field and we go to regions with this technology and we change lives, “Macias said.” Our goal is more than just financial inclusion. We want to change the sector, from agriculture simply to be able to sustain itself [to actually building] a financial stronghold e [being] able to grow. Hopefully, with our systems, our implementations and what we do, farmers aren’t just trying to eat tomorrow. “
Opening the shadows on the supply chain
The agricultural supply chain is incredibly opaque, particularly in developing countries where the demand for GrainChain services is highest. That opacity isn’t entirely coincidental, Macias noted. The reality is that many brokers and other players have taken advantage of the fact that the supply chain is incredibly confusing. There is no standard way to access information about where things come from, their quality at the time of shipment, how they have been transported and how long they have been in transit. What GrainChain has done and can now do more effectively, having linked to Mastercard’s Provenance technology, is to implement the technology and tools to simplify the systematic classification of products, such that all information about where they come from and what have been through is easily accessible.
“We are now allowing machines and not humans to add this data. And what it is doing is giving extreme legitimacy to the information that is entered, ”Macias said, noting that the information entered manually could be tampered with by someone acting dishonestly or being misrepresented due to honest human error.
Through their IoT integrations and their technology in the field, they can quantify the information and verify that it is real. Linked to the technology in the scalability of Mastercard’s Provenance solution, what you get is a “highly traceable record that cannot be changed”.
A growing need in vertical sectors
Macias noted that in a pre-pandemic world, as they approached the largest financial institutions and agricultural groups around the world, the services they offered and the transparency of the supply chain were considered a pleasant thing to have. Today no one thinks that way anymore.
“COVID has shown that this is where we need to go,” he said. “When you start pulling people out of the equation and putting systems into the equation, when you start transferring money digitally, when you start moving records and doing things in a way where there is less human interaction and more efficiency, at this moment in history this is something that everyone likes now. “
Deborah Barta of Mastercard noted that the need is felt in supply chains across verticals, not just in agriculture, where this collaboration is starting.
“The roadmap from here is broad,” he said. “And so to allow them to expand to any country, any region, [and] expand into other sectors, perhaps wherever they decide to take their business, we can adapt it to the commonality of global services that we already offer today. It is a logical extension. “
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NEW PYMNTS DATA: HOW WE BUY – SEPTEMBER 2020
The How We Shop report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research is based on a series of studies conducted since March that looked at over 16,000 consumers on how their shopping habits and payment preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their growing appetite for online commerce and touchless digital methods, such as QR codes, contactless cards, and digital wallets, is poised to shape the post-pandemic economy.
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