When Considering Locations For GoodDollar’s Basic Income Pilot We Ran The Rule Over Rwanda

Early last December, I touched down in Rwanda for the first time, alongside Ziv Kienan, GoodDollar’s Legal Lead. The mission during our three-day visit was to assess whether the Central African country, with a population of around 12 million people, is a suitable location to launch the next basic income pilot project.

GoodDollar is a not-for-profit foundation whose driving ambition is to reduce global wealth inequality through a combination of UBI principles and blockchain. Following a hugely encouraging first 12 months, we rolled out a closed beta test in November. The idea was to test our mobile (web-based) wallet, our token network (GoodDollar), and the overall usability of the product. (Read our early analysis here.)

In 2020, at the start of a new decade, we want to think bigger. Hence why we are considering a larger-scale roll out, possibly in Rwanda. GoodDollar is determined to reduce global wealth inequality, and more specifically elevate the poor out of poverty. We believe our model, and UBI mechanic, is robust enough to do just that, at scale. However, we need to firm up a location for the pilot project, and so, set ourselves three criteria:

Why Rwanda? Criteria For The Location Of GoodDollar’s Basic Income Pilot Project

1. A country with significant wealth inequality. According to the World Inequality Database, the wealthiest 10 per cent of people in Rwanda own over half of the country’s assets (53 per cent in 2017, the latest year assessed). Further, World Bank data suggests Rwanda has a Gini coefficient of 0.44, where 0 corresponds with perfect equality (everyone has the same income) and 1 is equal to total inequality (whereby one person has all the income). By comparison, the figure in the United Kingdom is 0.33, while in Israel it is 0.39. (Fun fact, USA Gini is worst than Rwanda’s at 0.49 in 2018)
2. A mobile-compatible environment. This criterion concerns both mobile phones and also smartphones. We were encouraged to learn that, in terms of mobile network, Rwanda has impressive 4g reception — even in extremely remote parts of the country. There were other encouraging signs; for instance, We were interested to learn that Africa’s first smartphone — Mara Phones (Retained at $100), designed in partnership with Google as part of the Android One Program — launched at Kigali in October. Internet penetration in Rwanda currently stands at over 52.1 per cent, up from 7 per cent in 2011. However, according to Forbes, smartphone penetration is only 15 per cent. At GoodDollar we have started building our wallet for smartphones, using React Native, which makes it accessible for most smartphones on the market — even cheap ones, however, the low smartphone penetration rate could be a challenge for us in the short-term.
3. A regulatory-compatible environment. In the aftermath of initial coin offerings, central banks, in charge of balancing the monetary policy and controlling the price of the local official currency, have voiced further concerns to the use of CryptoCurrencies, especially ones that can deliver alternative value to citizens. Would local government object to the delivery of UBI to its citizens? This is a question we are still learning. Having written that, it was pleasing that in 2018 The New Times, Rwanda’s leading daily newspaper, proudly reported that the country “ranked among Africa’s three least corrupt nations again”. Since our mission is, in our opinion, just, we’re hoping to get the blessings of local officials for the county-wide test.

Blockchain In Africa — A Big Opportunity?

GoodDollar is running the rule over a number of countries, in addition to Rwanda, to determine the location for our next pilot — these include Vietnam, the Philippines, Indonesia, Ukraine, Cambodia and Nigeria. After three intensive days in Rwanda, my mind is boggling with thoughts and questions. I know Ziv feels the same.

Many people say that there is a massive opportunity for blockchain-backed finance systems across Africa as a whole. We tend to agree, having visited Rwanda. The country is on a mission to continue to deliver hyper-growth and to achieve that it is investing in a range of country-wide reforms, including in education, commerce and citizen’s services.

In practice, these reforms are backed by new digital infrastructure for the country. The decision of running all new services on blockchain-based transparent, fast, secure and auditable data systems, is almost trivial in 2020 — and the people we met with in Rwanda are well aware of that fact.

Rwanda: A Contender For GoodDollar

We were excited to learn about the county’s opportunities and challenges from business, education and government sectors. We were even more pleased to have had the opportunity to drive out of Kigali, the capital city, and visit local communities that would most benefit from UBI.

GoodDollar’s decision about our next beta location will be made in the coming months. Meanwhile, keep an eye out for a second post that details who we met with in Rwanda, and how, with the help of our new friends, we can step closer to achieving our goal of reducing global wealth inequality.