Blockchain for Cross-border Remittances in Sudan: A Humanitarian Approach

Using blockchain is one of the safest, fastest, and low-cost ways to send money anywhere across the world. As every transaction can be verified quickly with technology, worldwide blockchain payments are expected to reach USD10 bn (approximately SDG6 bn) by the end of 2023. There is evidence that blockchain helps humanitarian crises as well as the World Food Programme (WFP) has used blockchain to distribute cash to 10,000 refugees living in camps in Jordan. With this in mind, blockchain has the potential to be used by migrants, organisations and volunteers keen to help individuals in Sudan to survive. 

Instant access to money

Due to ongoing fighting between armed forces in Sudan, people in Sudan are dealing with ongoing workplace closures, food shortages, difficulties accessing water and power, and bank closures. Their cash has dried up, as when the war began on 15 April 2023, they had to use what they had on emergency supplies. These individuals clearly need financial help, which can be done by sending blockchain. The time it will take for the Sudanese to receive blockchain will vary from just a few seconds to around an hour, although, smaller transactions usually go through faster than larger ones. When the blockchain is received, payment for essential items can be made using it.

Optimum transparency

Blockchain is often confused with Bitcoin. While the two share some similarities, they have their differences, too. Bitcoin is a type of cryptocurrency whereas blockchain is a distributed ledger technology. It’s preferential to send Bitcoin via blockchain to people in Sudan, as it is secure and transparent. You don’t want to have to worry about issues associated with Bitcoin such as the recent collapse of the crypto exchange, FTX. The value of the company quickly dropped by 80% and there were claims they mishandled their customer’s funds. Transparency is crucial for cross-border remittances in Sudan as it allows donors to track their donations. It also eliminates the possibility of corruption, which could happen due to a lack of regulation as a result of the war. Blockchain payments can’t be altered or redirected by a third party, either, which is what makes them ideal for sending financial help to people in need.

Improved access and larger funds

The United Nations Office for the Coordination of Humanitarian Affairs (UNOCHA) reports that, to date, approximately 1.3 mn people in Sudan have had to flee their homes. With no identification documents on them, getting access to money will be difficult. Blockchain utilises blockchain-based identity solutions instead of official paperwork, which gives individuals in Sudan easy access to cross-border remittances. Another big benefit of using blockchain for cross-border remittances is that it reduces the need for intermediaries and associated costs. This means that as much money as possible is received by the individuals that are most in need.

 Potential drawbacks

While there are many advantages connected to using blockchain to address the humanitarian crisis in Sudan, there are some drawbacks as well. One of them is the lack of internet access in the country. According to World Data, just 28% of the population has internet access and this has been greatly impacted by the war. After the conflict started in April, only 2% of the Sudanese population was able to access the net. Reliable infrastructure is needed to ensure blockchain funds get to where they need to go. However, with Sudan having unreliable Internet access and power outages, it makes it difficult to get blockchain funds to people. 

Another issue is that the Sudanese are likely to be reluctant to use blockchain as the Central Bank of Sudan has warned individuals not to use cryptocurrency because it is ‘high risk’. At present, there is no legal framework that governs blockchain. Other countries have regulations in place to prevent crimes, such as fraud and identity theft, but Sudan does not. Blockchain also is not something that people generally know about. You need to have technical and financial literacy to understand it which tends to be low across much of Sudan, including among refugees and individuals living rurally. However, this can be overcome with education and awareness programmes. 

A humanitarian approach to cross-border remittances in Sudan is needed and there is no better way to do this than through blockchain. By using this method, vulnerable Sudanese inhabitants will have the best chance of regaining financial control. 

With nearly two decades of experience, Nina Su has honed her writing skills and developed a deep understanding of the craft. Over the years, she has explored various genres, styles, and subjects, continuously refining her ability to engage readers and convey her messages effectively. Writing allows her to explore different topics, delve into research, and expand her understanding of the world. Ultimately, she finds writing to be a fulfilling and enriching pursuit that brings her both personal satisfaction and the opportunity to impact and connect with others through her words.