Cambodia has been chosen to pilot an progressive blockchain-based fintech platform known as Common Trusted Credentials (UTC), a digital credentialing system leveraging Web Pc Protocol (ICP) blockchain expertise. This initiative is developed by a world growth group in collaboration with numerous international companions, as introduced by the United Nations Improvement Program (UNDP).
The target of this new expertise is to ascertain a safer and accessible digital credentialing system geared toward selling sustainable growth and financial progress. Representatives of the venture highlighted the potential of UTC to considerably influence the monetary sector.
The UNDP will accomplice with the Dfinity Basis for the Cambodian pilot venture. The Dfinity Basis, based mostly in Switzerland, makes a speciality of blockchain expertise analysis and growth (R&D). In keeping with a UNDP report, UTC features as a world framework of indicators designed particularly for enterprises. The info factors inside this framework are sourced completely from authoritative knowledge sources and are chosen based mostly on their relevance and utility to monetary establishments for assessing an enterprise’s intent and skill to pay.
The framework is designed to facilitate extra environment friendly, cost-effective, and better ranges of financing and monetary providers. That is significantly helpful for micro, small, and medium-sized enterprises (MSMEs), which frequently face challenges in accessing financing or are subjected to heightened collateral necessities on account of a scarcity of verified knowledge.
International Trials and Enlargement Plans
UTC was initially launched in November 2023 by the UNDP and the Financial Authority of Singapore (MAS). Earlier than the announcement of the Cambodian pilot venture, MAS and the Financial institution of Ghana carried out a trial of the UTC system in Ghana in Could. The Ghana venture utilized a semi-fungible token (SFT) to switch licenses and commerce information into the UTC system. The primary pilot of the expertise additionally demonstrated the inclusion of a Know Your Buyer (KYC) verification inside an SFT.
The UNDP has described the Ghana UTC system as a proof of idea, indicating its potential for additional worldwide growth. The group goals to ultimately implement UTC in ten partnering nations worldwide.
Marcos Neto, the UN assistant secretary normal and director of the UNDP’s Bureau for Coverage and Programme Help, emphasised that harnessing superior expertise may result in the creation of a safer and accessible digital credentialing system, driving sustainable growth and financial progress. Dominic Williams, founding father of the Dfinity Basis, famous that utilizing the Web Pc blockchain expertise would enable the UTC initiative to profit from intensive analysis and growth, supported by main cryptographers and digital identification consultants.
The Dfinity Basis’s decentralized ICP blockchain Web Id answer will guarantee safe storage and administration of digital credentials throughout the Cambodian UTC pilot, as highlighted within the UNDP assertion.
Cambodian Monetary Sector and MSME Help
Earlier than the latest announcement of the UTC venture launch in Cambodia, Rath Sovannorak, deputy governor of the Nationwide Financial institution of Cambodia (NBC), attended a roundtable dialogue in Zurich, Switzerland. The discussion board, titled “Launching Common Trusted Credentials (UTC): Experiences and Challenges,” was a part of the Level Zero Discussion board, a three-day monetary expertise occasion held from July 1-3.
In the course of the assembly, Rath Sovannorak mentioned the present scenario of MSMEs in Cambodia and their vital position in socio-economic growth. He identified that MSMEs face specific challenges in accessing monetary providers. The deputy governor additionally highlighted the progress made by the Royal Authorities of Cambodia (RGC) and the NBC in supporting MSME progress by way of insurance policies that promote native manufacturing and enhance employment within the sector. He confirmed that the UTC venture in Cambodia goals to create a strong database to assist MSMEs overcome challenges, particularly in accessing monetary providers from banking and monetary establishments.
In 2020, the NBC launched the Bakong app, a tokenized forex fee and deposit system leveraging central financial institution infrastructure, to assist MSMEs’ entry to finance and scale back bodily transactions throughout the Covid-19 pandemic. Developed collectively with Soramitsu, a Tokyo-based blockchain expertise startup, the digital forex went into circulation in October 2020. The blockchain-based, open API fee system facilitates rapid QR-based transactions and hyperlinks to each riel and greenback financial institution balances, though customers don’t want a checking account to make use of the app.
Bakong has additionally been utilized for cross-border funds and might facilitate QR code-based transactions between Cambodia, Thailand, Laos, Vietnam, and China’s UnionPay. The NBC has signed a number of memoranda of understanding with different nationwide banks and fee system authorities worldwide to develop the app’s cross-border fee capabilities. In keeping with NBC governor Chea Serey, the system hosts round 10 million wallets, as reported in an interview with Nikkei Asia in December 2023.
