Cutting Edge Blockchain Tech Advances Social Lending

We sat down with Anton Dzyatkovsky, co-founder of MicroMoney. He says he can help millions of people get their first loans - through blockchain.

Q: Mr. Dzyatkovsky, you have started a blockchain-based microfinance company that wants to serve the unbanked – people around the globe who do not have bank accounts and want to get a loan. However, you also focus on people who migrated from one country to another. What services does MicroMoney offer specifically for this category of borrowers?

After you immigrate, it can be tough to get a loan or a credit card in your new country. I personally moved often and lived in several countries over the last three years as my business was expanding. We are a fintech company and a social lending service provider called MicroMoney. And we help those who cannot get access to money when they need it.

Even if you always paid off your loans on time in one country, you may be a nobody in another. You used to start your day with a glass of expensive champagne and a caviar sandwich. But this – and all your other habits – may be virtually unknown in another country. Likewise, your financial habits and your life as a consumer will probably not follow you. Banks use different credit scoring models so your credit score and reliability vary in other countries.

Q: Why is that important for those who relocate to another country?

It can turn out to be a sad story because you become totally dependent on a bank’s scoring system. And when you move, you have to create everything from scratch. That includes hours of chasing papers, long queues, and nervous breakdowns with little progress.

However, I think that my company has a solution. We at MicroMoney need only your smartphone data to get you a loan. Everything is transparent, so you don’t have to wait for a bank approval or struggle to prove that you are a reliable credit customer, even if you now live in a brand new world for yourself. You just download the MicroMoney app and it will explore all the data stored on your phone for several minutes and approve (or disapprove) a loan to you.

This speedy approval method revolutionizes the whole banking industry. And in addition, we plan to drop the cost of loans down to 0% for users who follow the rules and repay on time.

Q: How are you able to provide loans just through an app and a phone?

There is a traditional way to evaluate borrowers based on a credit rating. There are hundreds of credit scoring models in use today. The FICO and Vantage scores are the most common worldwide credit-scoring models with scores ranging from 300 to 850. The higher the credit score is, the better is your creditworthiness.

However, immigrants are almost always forced to start from nothing. So it's usually difficult for them to obtain credit cards and mortgages until they have worked in the new country with a stable income for several years. Credit scores don’t transfer. For example, Equifax Canada does not share credit information with Equifax in the United States.

MicroMoney can change this reality. The key to our system is a revolutionary technology that helps banks make lending decisions based on proprietary AI algorithms and neural network-based mobile scoring. The lending process doesn't require any collateral or paper-based documentation. MicroMoney collects customers' opt-in mobile phone data to establish a potential borrower’s credit score.

The score is then used to generate credit profiles, which are stored on a blockchain. And those profiles can be shared with financial institutions. Then once a loan is approved, the money goes to the borrower’s e-wallet.

Q: Why do you call your service "social lending"?

We think of access to the credit system as a basic human rights issue. Two years ago we started to fulfill our social mission of helping 2 billion of the world's unbanked people gain access to the financial system. People should be able to get extra money when they truly need it and solve their urgent problems. And they shouldn’t suffer from the fact that banks of different countries have no corresponding agreements on credit history transfers between countries.

In 2015, when MicroMoney started to provide social microloans, someone could hardly imagine that smartphone data could be a factor in obtaining a loan. Today it's a best practice.

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