Argentinian startup Ripio is making peer-to-peer microloans available today to all its 200,000 bitcoin wallet users in Argentina, Mexico, and Brazil, as revealed to Coindesk.
Ripio, which is based in Buenos Aires raised $37 million in its ICO during 2017 and built the Ripio Credit Network with the funds. The platform matched borrowers with lenders globally using ethereum smart contracts. The full launch of the platform happened in early September, following a successful beta trial covering 800 loans.
Ripio said it now has 3,000 lenders on its network, many of them based in Asia, issuing loans for up to $730, although so far the average loan size is $146. Ripio’s CEO said that it was remarkable that Asian people were lending to people in Latin America and that the Ripio app is the only product currently making that possible.
Ripio has actually been established in the crypto credit space in Argentina since 2016, but when it started it lent its own funds to consumers. However, it now has a much more ambitious vision — that of a global P2P lending platform.
While the borrowers receive their loans in fiat, the new network is powered by an ethereum-based token called RCN. Lenders send the funds in RCN, and Ripio (and, potentially, other wallet providers) converts the RCN to fiat before forwarding the money to the borrower.
Most importantly within the Latin American economies, Ripio offers its services to the unbanked. Citizens of the continent often have a complex relationship with mainstream banks as statistics from the World Bank indicate: for example, around 30 percent of adults in Brazil are unbanked, compared to 54 percent in Colombia. How do these unbanked users manage to access the Ripio platform? According to Ripio they fund their wallets by depositing cash at convenience stores partnering with Ripio.
Using Ripio can also help unbanked people build up a more traditional credit rating, simply by repaying loans on Ripio and this could help them obtain other types of financial services in the future. As Ripio’s CEO says, “It gives the user credit history. Even if the marketplace disappears the code will continue to execute.” Furthermore, that credit history will be recorded on a smart contract. Indeed,
The platform also wants to make credit histories recorded in smart contracts more widely useful, and has proposed a standardised way to present claims about an identity on ethereum. These would show that an individual has always repaid their loans in full and is therefore a good credit risk.
With so many unbanked in Latin America, the Ripio platform and other cryptocurrency infrastructures are likely to achieve strong growth here and a friendly reception