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How Crypto-Based Microfinance Benefits Small Businesses
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Starting your own business isn’t easy given the reluctance of banks to grant credit. Gone are the days when a compelling business plan would be enough to have the branch manager shaking your hand and bankrolling your venture. For entrepreneurs in developing nations, where even obtaining a bank account can prove challenging, getting their idea off the ground often calls for non-traditional funding. Crypto-based microfinance is one such solution.

Also read: Bitcoin Cash Privacy Has Improved in Leaps and Bounds

Unbanked Businesses Are More Common Than You Think
The unbanked are synonymous with Africa, where over 400 million adults lack access to the financial system, but can be found in their droves on every continent. In the U.S., for example, 8.5 million adults lack access to the financial system. Cryptocurrencies such as bitcoin have long been touted as a salvation for the unbanked, granting them a means of saving and exchanging value, but the benefit decentralized assets bring to small businesses is less documented.
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SMEs, both banked and unbanked, face financial pressure from day one, paying proportionately more for goods, import taxes, legal and administrative expenses, and compliance costs than larger enterprises. As a result, many small businesses fold long before they’ve even had a chance to challenge the incumbents. Google and Facebook’s dominance of the advertising market, for example, is steadily increasing, with the introduction of regulations such as GDPR credited with disadvantaging smaller competitors.
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