Nongwan continues to discuss with you whether blockchain can become a new approach to agricultural finance:
Blockchain solutions that simplify complexity
The concept of blockchain involves many complex technical concepts, but the so-called "simplified", putting aside the complex attributes, its "decentralized" idea is actually not difficult to understand. For example, if you want to buy a TV, you will typically make a transaction with the seller during the process. This transaction involves a third party other than you and the manufacturer (both the home appliance mall and Taobao JD.com are third parties), and the transactions between you and the manufacturer are centered on the third party. So while you're simply purchasing a TV, both you and the manufacturer are providing excess funds and information to a third party. Decentralized processing will be more convenient. Transactions between two people do not require a third party, but the public becomes a witness. Imagine if there are thousands of transactions going on, decentralized processing will save a lot of resources, make the entire transaction autonomous and simple, and eliminate the risk of being controlled by a centralized agent. Decentralization is a disruptive feature of blockchain technology. It realizes direct point-to-point interaction, making efficient, large-scale, decentralized agentless information interaction a reality. Simply put, it restores the most basic fundamentals of trading. , original form.
Let's look at a practical case. Maersk is the world's largest shipping company, and its main business is transporting goods from one country to another. While the business model sounds simple, there are many parties involved in getting this thing done. Earlier this year, Maersk and IBM launched a pilot project using blockchain. The content is to use blockchain to track and record the flower import and export trade between Africa and Europe to improve the efficiency of the cross-border supply chain. Save costs and reduce risks.
Specifically, many flower farmers in Kenya make a living by growing flowers, and the world's largest flower trading market is in the Netherlands. Kenyan flowers need to be transported from Kenya to the Netherlands via Maersk ocean-going cargo ships for sale. From flower seeds to market sales, the entire process involves many parties in addition to Maersk's shipping services. In Kenya, flower farmers and exporters need to obtain bank loans. Before export, flowers need to be inspected by the inspection and quarantine department and local customs... When Maersk's 10,000-ton ship was loaded with flowers and arrived in the Netherlands after about 20 days of sailing. After that, the previous series of processes will happen again, but this time they will be replaced by participants such as Dutch Customs, Dutch Inspection and Quarantine, and ABN AMRO Bank. In this transnational supply chain process, which lasted nearly 20 days, there were approximately 10 participants and more than 200 relevant documents. In the flower trade industry chain and logistics system, a big reason for the complexity is the flow of flowers themselves, as well as the information flow of corresponding documents and the cash flow of loan financing. In traditional solutions, all relevant parties act as a hub and relevant data and information are stored in their own databases. Especially in industries such as finance, such systems are even called core systems, which are very difficult to share. . In the process of cross-border trade of flowers, flower-related information, documents, and funds flow in different centers. Of course, there will also be some inevitable shortcomings, such as: a relatively long process cycle, many links, poor transparency, etc., which greatly affects credibility and efficiency.
The introduction of blockchain technology is to use technical means to transform data and assets from central storage to sharing among different entities in a "decentralized" or "weakly centralized" manner, while achieving transparency and traceability. and cannot be tampered with. It changes from the center of each stage to a node in the larger system, thereby creating a larger shared database ledger that everyone maintains and updates together. During the nearly 20 days of cross-border logistics transportation, all participants have the right to update and enjoy data, and relevant data and files will be written to the shared ledger. Since all data and files related to goods are written to the blockchain at any time, and the data of each participating node in the blockchain is synchronized, relevant participants, whether they are manufacturers, sellers, customs, banks, etc. You can know the planting, growth, location, status, and even temperature, humidity and other information of the goods anytime and anywhere.
This case may seem like a foray into finance, but it provides a solution for the mortgage and credit system. Extending to the field of agricultural finance, financial institutions may use a "decentralized" approach to share information on the entire agricultural process from production to sales, thereby mastering the information flow of the entire process and grasping production and marketing trends through information flow. Filling gaps in mortgage lending and information systems.
future? there's still a long way to go!
Blockchain does provide new solutions to the problem of difficult agricultural loans. The main reason why agricultural loans are currently difficult to obtain is the lack of effective collateral. In the final analysis, it is the lack of credit mortgage mechanism. Blockchain is based on decentralized credit. It transcends geographical restrictions and can play a high-efficiency, low-cost value transfer role in the market that cannot be replaced by traditional financial institutions. When new agricultural business entities apply for loans, they need to provide corresponding credit information, which requires relying on the corresponding information data recorded by banks, insurance or credit agencies. However, there are problems such as incomplete information, inaccurate data, and high usage costs. The use of blockchain relies on program algorithms to automatically record massive amounts of information and store it on every computer in the blockchain network. Information is transparent and cannot be tampered with. High difficulty and low cost of use. Therefore, when applying for a loan, you no longer rely on intermediaries such as banks and credit bureaus to provide credit references. Lending institutions can retrieve corresponding information data from the blockchain.
Because of this characteristic, countries such as Australia, Israel, and Russia have begun to deploy agricultural finance in the field of blockchain, and many agricultural-related institutions in my country have also begun targeted attempts.
In the long run, the addition of blockchain technology can not only use new technologies to introduce multiple financial institutions to provide financial services such as small loans to rural areas and farmers, but also radiate local individual farmers and small, medium and micro enterprises. Large-scale agricultural business entities that cannot be covered by traditional finance. , also gained trust in agricultural production and realized full-process monitoring. While solving the problems of food security and food supply, it can also increase farmers' income, which is a huge driving force for the comprehensive development of agriculture.
But from the current point of view, both the technology and scenarios of blockchain are still in the conceptual stage, and the specific application direction still needs to be explored.
First, the technology itself needs to be optimized. Many people think that blockchain is very high-end, ubiquitous, and highly interconnected. However, judging from current applications, blockchain is still in its early stages, and its underlying technology still has certain constraints. Agriculture is a living industry, and it is necessary to further break through the technical limitations of blockchain and combine it with agriculture.
Secondly, the entry barrier for blockchain technology is very high. Blockchain technology actually involves many interdisciplinary and cross-field cutting-edge technologies such as cryptography, computational mathematics, and artificial intelligence. It may be difficult for ordinary engineers to master it in the short term. Agricultural informatization is still the "short board" of national informatization. What is most lacking at this stage is agricultural informatization talents. People who understand agriculture do not understand informatization, and people who understand information do not understand agriculture. As a new computer paradigm, the application of blockchain in the agricultural field has been several times slower than the Internet and agriculture, thus once again raising the entry barrier for blockchain technology to a certain extent.
Finally, the application scenarios of blockchain technology need to be continuously expanded. Most current blockchain application scenarios can be divided into virtual currency, registration notarization, smart contracts, securities, social affairs, etc. These scenarios are currently not closely related to agriculture, and there is a lack of practical applications that meet the characteristics of agriculture. agriculture and rural areas. Scenes. Blockchain is based on the Internet. In the process of exploring the rural Internet market, enterprises must continue to expand the application scenarios of blockchain. Only when a large number of user groups participate in the blockchain can its value be reflected.
标签： #Blocks #Agriculture #Applications #Flowers #Netherlands
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