The United Nations Development Program (UNDP) has signed a deal with the Stellar Development Foundation to expand the use of blockchain-based payments in its development programs, marking an important step toward integrating public blockchain infrastructure into humanitarian and development work. This agreement follows pilot projects in five countries and highlights blockchain’s potential to play a more visible role in aid distribution and economic development efforts.
Pilots pave the way for broader implementation
On Monday, UNDP announced that over the past 16 months it has conducted research and pilot studies in Haiti, Syria, Kenya, Guatemala and Gambia, and developed additional projects in Colombia and Papua New Guinea. The agency stated that the new phase will focus on creating operational processes that will allow country offices to use blockchain payments for a broader range of programs.
UNDP functions within the United Nations system as an agency committed to combating poverty, building institutional capacity and promoting sustainable development. The Stellar Development Foundation, meanwhile, is a non-profit organization that supports the Stellar Network, a blockchain designed for cross-border payments and digital asset transfers.
UNDP has announced that operational processes will be established in the next phase to enable country offices to leverage blockchain-based payments for broader initiatives.
Syrian and Haitian pilots deliver measurable results
The pilot programs delivered tangible results. In Syria, the ‘Cash for Work’ program saw distribution costs for blockchain-recorded payments drop from 10% to 2%. In Haiti, the payment system continued to function seamlessly, even during mobile network disruptions.
Such results have led to increased interest in blockchain-based payment networks, especially in areas where access to traditional banking is limited. Stablecoin-backed networks are gaining popularity due to their potential to cut costs and increase access for cross-border payments and transfers.
UNDP launches blockchain advisory group
At the Proof of Talk conference in Paris last month, UNDP launched a Blockchain Advisory Group to shape how the organization uses blockchain technology in its development programs. The group’s work will extend beyond digital payments and explore how blockchain can support digital public infrastructure and improve public systems in general.
Emerging markets are driving real-world adoption
UNDP’s move reflects a broader trend toward modernizing cross-border payment systems in emerging markets. Poor access to banks and high transfer fees make stablecoins increasingly attractive, especially in Latin American countries such as Argentina, Bolivia, Colombia and Venezuela, which stand out as busy payment corridors.
A similar trend is visible in Africa. Ripple recently acquired a stake in Africa-based fintech company Flutterwave as part of its strategy to expand the use of RLUSD stablecoin and XRP Ledger on the continent. In the region, remittances remain a crucial source of household income.
Former UN Under-Secretary General Vera Songwe noted that 650 million people in Africa do not have access to a bank account, but people with smartphones can access digital financial services through stablecoins.
Speaking at the World Economic Forum’s annual meeting in January, Songwe highlighted that digital payments are having an impact beyond just remittances in some developing economies. She argued that stablecoins are becoming even more important than aid in certain countries, as they enable digital financial services for populations excluded from the traditional banking sector.
Credit : cryptonews.net
