By Crimson Tazvinzwa

The World Food Programme  rolls out blockchain technology —a type of distributed ledger technolog as part of its “Building Blocks” pilot, to expand refugees’ choices in how they access and spend their money.

The humanitarian aide agency also explores the feasibility and effectiveness of Building Blocks cash transfers, their security and transparency. Most notably, the World Food Programme  has used blockchain to deliver food aide more efficiently to 106,000 Syrian refugees in Jordan. Building Blocks facilitates cash transfers while protecting beneficiary data, controlling financial risks, and allowing for greater collaboration.

Blockchain; Weapon against hunger?

At the heart of Building Blocks is research showing that direct cash transfers to those in need can be the most effective and efficient way to distribute humanitarian assistance while also improving domestic economies. In 2018 for instance WFP distributed record cash transfers of $1.76 billion with bare minimum risks.

But distributing cash depends on local financial ecosystems and, where possible, WFP prioritizes working through and strengthening the local financial environment. However, in some contexts, financial service providers are either insufficient or unreliable. In others, refugees face restrictions in opening bank accounts. That’s why in January 2017, WFP initiated a proof-of-concept project in Sindh province, Pakistan, to test the capabilities of using blockchain for authenticating and registering beneficiary transactions. The blockchain technology behind the project allowed direct, secure, and fast transactions between participants and WFP—without requiring a financial intermediary like a bank to connect the two parties.

Biometric recognition (also known as biometrics) refers to the automated recognition of individuals based on their biological and behavioral traits (ISO/IEC JTC1 SC37). Examples of biometric traits include fingerprint, face, iris, palmprint, retina, hand geometry, voice, signature and gait

After refining the project’s approach, the next phase of Building Blocks was implemented in two refugee camps in Jordan. Now, over 100,000 people living in the camps can purchase groceries by scanning an iris at checkout. Cash value from WFP or other partners is stored in a beneficiary ‘account’ maintained on the blockchain, but the cash that beneficiaries receive or spend on goods and services is paid to the beneficiaries or to the retailers through a commercial financial service provider. Built on a private, permissioned blockchain, and integrated with UNHCR’s existing biometric authentication technology—WFP has a record of every transaction. This not only saves on financial transaction fees in the camp setting but ensures greater security and privacy for Syrian refugees.