Jita is the first blockchain micro credit platform. As blockchain reduces the cost of small value international payments to less than 5 cents, it is possible to imagine new business models in finance. At the same time, more than 2 billion adults in emerging markets are discovering Internet thanks to low cost smartphones.
Interestingly, financial institutions have difficulty offering services to this population. This problem is so big that there is name for it: the underbanked. Why have they been under served until now ? First, many emerging markets have poor rule of law, making it difficult to establish new banks. Second, these countries often lack infrastructure, particularly in telecoms until the advent of low cost mobile networks. Finally, banks generally make a loss with free current accounts and recoup the loss by selling mortgages. Low income populations require new business models as they may not be able to afford a mortgage. Micro finance institutes have developed specific offers. Some mobile operators have leveraged technology to enter financial services: M-Pesa and airtime lending are two good examples that come to mind.
We believe we can do better. Micro finance institutes are local, and focused on their core business and finance. This prevents them from investing in technology innovation. Some are not for profit, or have regional or national scope only, further constraining them in their growth and development. Airtime lending offers mobile phone users a way to top up their phone when they run out of credit and do not have cash. The airtime loan, for instance 30 minutes, is then repaid a week later with a very high interest fee. The mobile phone operator is using the mobile number itself as collateral, disabling it if the user doesn’t repay her loan. At Jita, we believe that the underbanked deserve better. That is why we are building a micro credit platform with low total operating cost and that can be accessed anytime, anywhere. A modern platform that puts the user first.