Visa (NYSE: V), a world leader in digital payments, was one of nine finalists tasked with exploring innovative blockchain-based use cases for the Real Digital (Brazil’s central bank-issued digital currency, or CBDC) as part of the most recent LIFT Challenge. The company partnered with Agrotoken, Microsoft, and Sinqia to develop its submission.
Small businesses are essential contributors to our local economies. At Visa, we are committed to help them grow and exploring new technologies.
After months of collaborative work between each company’s world-class researchers and engineers, Visa and its team are excited to share the results of their LIFT Challenge participation — a programmable finance platform for Small and Medium Enterprises (SMEs), particularly farmers, that is designed to enable greater access to global capital markets, facilitate interoperability between currencies, improve operational processes, and uncover new growth opportunities.
Small Businesses Drive Global Economies
SMEs are often beholden to localized market structure in negotiating favorable contracts. For example, factoring is a well-known financing method today where a farmer can sell their future receivable at a discount to receive money today to purchase supplies and pay wages. This process routinely leads to a sizable percentage loss of the farmer’s receivable to the entity providing financing.
Visa’s prototype is designed to provide local farmers with more timely and greater access to a global pool of investors for financing, allowing the SMEs to get the best price discovery for their goods. By empowering SMEs with additional options to finance their businesses in a secure and frictionless way, Visa’s prototype platform aims to improve existing money movement operations and alleviate pain points caused by inaccessibility to traditional services.