Introducing Bright - Financial Services on the Blockchain

#Announcements

Bright is a building financial services on the blockchain, designed to solve the credit gap faced by millions of small businesses in emerging markets and around the world.

Trust is an essential ingredient of a thriving business ecosystem. It’s what allows companies to form new relationships and to rely on existing ones, but building trust is far from an easy task. New technologies have catapulted marketplaces to the forefront over the past decade, but these technologies have been slow to modernise financial services. It has been difficult to build the sort of trust that is needed to level the playing field for small businesses around the world, in particular in emerging markets, where it’s difficult to verify and shape business data into accurate credit scoring. This has resulted in a US$5.2 trillion dollar credit gap, according to World Bank figures. [1]

Enter the blockchain.

Since its inception, blockchain has been hailed as a revolutionary technology that can change the world, and finally we're truly seeing its potential. With blockchain technology, we can use cryptography, tokenised data access, and decentralisation of data storage to design a solution that solves the problem of trust in accessing credit.

Introducing Bright

Bright’s mission is to close the credit gap, as well as open up a whole new world of opportunities for small businesses. We want to give financial service providers access to the tools and information they need in order to make faster, more accurate lending decisions.

How does it work?

Bright uses peer-to-peer verification to help business owners verify their transactions and, over time, build a reputation history. By combining this with traditional financial data and non-traditional data sources such as social feeds, and applying data analytics and machine learning, we’ll be able to generate a more accurate and fairer credit risk assessment.

Lending is our first use case

We’re not a lender, but an ecosystem. We’re building a decentralised marketplace of financial services, and we’ll start by proving that this model works through lending. Here’s how:

Bright business model

First, we’ll prove that the Bright ecosystem can grow by incentivising an initial group of businesses to claim their data vault, contribute their information and validate P2P transactions. At the same time we will launch Bright Bank, the first lender of record in the ecosystem. By using our own risk model, we’ll be able to make lending decisions immediately and start approving micro-loans of up to $10,000 USD. This allows us to have immediate impact in three go-to-markets: Kenya, Nigeria and India, where we have already identified 650 profitable, scalable businesses that require lending to take the next step.

After proving our model, we’ll open up the Bright ecosystem to third party lenders. In the beginning, this will include commercial banks and institutional investors. Through this marketplace model, we can increase the total lending liquidity available to the Bright ecosystem and create more choice for small businesses.

Banks want to lend

Having spoken to banks already operating in our go-to-markets, we know they want to lend. $8 Trillion dollars is currently held in negative yield bonds globally - which means investors are paying to invest their money as opposed to making a return through interest. [2]

The problem is risk. Bright reduces the risk for lenders by helping them source information on the borrower, which will lead to better lending decisions and reduce exposure to risk. Bright data also provides more accurate pricing of interest rates, the benefits of which are passed on to the borrower. The business owner, of course, is in control of every data access request.

For an in-depth explanation of Bright, please read our White Paper

Can’t build in a bubble

It’s clear that we cannot solve this problem alone. Our own lending book can only reach a certain size before we can no longer manage it effectively. To tackle a $5.2 trillion dollar problem head-on, we need a way to scale our lending liquidity through a multiplier effect.

Our approach is to focus on a marketplace model in the long term. Through partnering with banks and other lenders who manage trillions in available capital and by de-risking their lending, we can have a far greater impact than as a lender alone.

By understanding the existing perspective and challenges lenders face, we’re building a product and an ecosystem that is genuinely scalable.

Be part of the Bright ecosystem

Together, we’re closing the $5 Trillion dollar credit gap in emerging markets

Join us in our journey to build decentralised financial services, and to unlock the potential of the next generation of global businesses!

Join the Bright community on Telegram and speak to the team | Follow us on Twitter to get all our big updates and announcements | Learn more about the project at brightnetwork.io

References:

[1] https://finances.worldbank.org/Other/MSME-Finance-Gap/ijmu-5v4p

[2] https://www.bloomberg.com/news/articles/2018-06-20/negative-debt-pile-swells-by-1-trillion-as-trade-clouds-gather

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