Currently, there are tons of barriers to the flow of capital. While we have experienced countless technological innovations in almost all facets of life and industries, the financial system has remained the same, without any significant change. On a global scene, first world countries or developed countries get lower profits for moderate risks, while borrowers from developing or third world countries pay higher rates for mid risk loans. While some individuals from third world countries are charged high rates, others do not even get access to these loans at all.
Although capitals that are gotten from developing countries are used to invest in developed countries, there is still an inversely lower capital flow rate. Why is this so?
• Certain bureaucratic and institutional barriers or problems is one of those reasons.
• The lack of access to investment opportunities in third world or developing countries for medium and small capitals.
• Ignorance on the part of borrowers in third world countries when it comes to financial profitability.
• Misinformation in regards to political and legal instability.
• Lack of trust.
These problems mentioned above hinders developing or third world countries from growing economically. According to several reports, the lack of credits has been attributed as one of the main restraints or reasons for the lack of economic development in third world countries.
The blockchain technology and smart contracts could just be the needed tools. They are capable of eliminating the need for centralized structures or systems. This not only gives confidence to these borrowers, but its general impact is also powerful. These technologies eliminate the need for banks who previously act as guarantors between parties, thus, allowing for safer and faster payments. They are also capable of providing credit access to billions of people previously excluded from it.
Merging the blockchain technology and smart contracts, the Ethic Hub platform has been able to provide access to highly- profitable impact projects by connecting investors to certain projects rated by risk level. The Ethic Hub platform happens to be a crowdlending platform or network that enables access to groups of small and medium-scaled producers from third world countries to credits with lower rate loans that are way lower than those available to them currently.
The Ethic Hub team is committed to providing access to credit to producers from all over the world. To do this, the developers of this platform has built the platform on certain values, which are;
• Integrity
• Responsibility
• Respect
• Justice
• Equity
• Honesty etc.
The goal of this platform according to the developers is to prove that in compliance with these values, material benefits could be generated. This platform is working with a non-profit organization LendingDev which has been built to provide certain services to Ethic Hub.
Using the following mechanisms, EthicHub will curb risks involved in loans and investments, provide a secure basis for loans, mitigate fees and ensure that in case of default, both parties go home smiling.
This credit-based platform is developed by a team of entrepreneurs with vast experience in their respective fields which range from technology, finance, marketing, innovation, and intermediation. These team members include;
• Joris Armbruster; the coordinator node
• Pablo Chang; the project node
• Raul Martinez; the technology node
• Rainer Aigner; the marketing and operation node and a long list of others.
EthicHub Explainer Video
