Key Takeaways:
- Ripple, Mercy Corps Ventures, and DIVA Donate are using blockchain to deliver anticipatory drought relief to Kenyan pastoralists.
- The RLUSD stablecoin will be auto-distributed to drought-affected communities via satellite data and smart contracts.
- The pilot seeks to provide transparent, efficient financial aid to support 500+ farmers during droughts.
In a recent collaboration, Ripple, Mercy Corps Ventures, and DIVA Donate are testing a novel blockchain-based system for providing timely aid to communities affected by drought in Kenya.
This initiative, a major leap in humanitarian efforts, uses Ripple USD (RLUSD), a US dollar-backed stablecoin, in a system that ensures pastoralists receive aid swiftly and transparently.
The collaboration addresses the recurring and catastrophic droughts experienced by pastoral communities in Kenya’s Laikipia County, which is largely composed of arid and semi-arid terrain.
The approach is both data-driven and automated, relying on satellite data to detect drought risks and triggering payouts through smart contracts. Using the Normalized Difference Vegetation Index (NDVI), satellite technology will monitor the health and density of vegetation, which serves as an indicator of the environmental conditions affecting livestock.
Once these conditions indicate the onset of drought, the system automatically releases RLUSD to affected pastoralists. This method is far more proactive than traditional aid, providing financial support before the crisis reaches its peak.
If the NDVI data indicates a lack of suitable vegetation for grazing, each pastoralist enrolled will receive approximately $75 in RLUSD, which will be used to purchase a livestock animal’s worth of food and water for a period of six months.
As a pilot project, the scheme will benefit 533 pastoralists in the north of Laikipia County, a region predominantly covered by arid and semi-arid landscapes that are regularly subject to drought. Further detail on the pilot can be accessed here.
Ripple Drives Inclusive Global Solutions
Above all, this pilot represents a test case for the increasing use of blockchain and stablecoins in the field of humanitarian aid and financial inclusion. With the increased transparency of blockchain, all transactions become visible on a public ledger and can be verified.
With the programmability of smart contracts, the money can be paid only when conditions are satisfied, and no middlemen are needed. All the issues present in traditional aid disbursement, delay, inefficiencies, and inaccessibility for the marginalized, are addressed by this system. Blockchain technology, in the form of stablecoins such as RLUSD, can potentially solve long-standing problems in cross-border payments.
Using Ripple’s blockchain system in this test case could open the door for future humanitarian use as well, with Ripple building on the efforts with programs such as Ripple Impact by assisting organizations including Mercy Corps Ventures and CARE with using the blockchain for financial inclusion and the delivery of aid.
Nonetheless, with the use of blockchain in disaster relief, Ripple and partners are revolutionizing the way aid is distributed, making it more swift, intelligent, and transparent, a development that can reshape the future of humanitarian aid.
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