UNHCR launches aid payments to Ukrainians using blockchain technology

This is reported on the UNHCR website, Ukrinform reports.

“UNHCR, the UN Refugee Agency, and the Stellar Development Foundation (SDF), the non-profit that supports the growth and development of the Stellar blockchain network, announced today the launch of a pilot first-of-its-kind blockchain payment solution for digital cash distribution to internally displaced persons (IDPs) and other war-affected people in Ukraine.” – the message says.

It is noted that the pilot phase of the project is designed specifically for Ukraine but can be adapted worldwide. UNHCR confirms eligibility and distributes assistance in Circle Internet Financial’s USD Coin (USDC) — a stablecoin where one USDC is equal to one US Dollar — directly into a recipient’s Vibrant digital wallet which they can download onto a smartphone. This provides a secure place to hold and transport funds in USDC, a stable store of value, allowing people to travel within the country or cross borders without the need to carry cash.

“When recipients choose to convert to cash, whether it is dollars, euros, or local currency, they can withdraw their funds at any global MoneyGram location, including over 4,500 MoneyGram locations in Ukraine”, – UNHCR noted.

The agency added that the program is being piloted in Kyiv, Lviv, and Vinnytsia and will expand to other towns and cities in Ukraine. ​​The money will provide humanitarian assistance to some of the people most impacted and vulnerable due to the war, to help them cover basic needs like rent of accommodation, food, medical care and heating during the winter. The solution has been extensively tested over the last six months and is expected to be expanded to reach more war-affected people inside Ukraine as well as refugees from Ukraine in early 2023.

It is emphasized that this blockchain initiative complements UNHCR’s goals to further expand the systematic and rapid use of Cash-Based Interventions. Since 2016, when UNHCR issued its first Policy on Cash Based Interventions, UNHCR has delivered almost USD 5 billion in cash assistance to some 35 million people in 100 countries. UNHCR is committed to further expanding the provision of cash, which is normally the preferred assistance modality by people forcibly displaced, as it gives them the freedom and dignity to themselves decide how to prioritize the assistance given, based on their personal need.

“Ukraine is a global lead in the development of technical solutions to increase access to social protection, including assistance for displaced people. Across the world, UNHCR has been collaborating for years with the tech sector, which has played a crucial role in helping us to innovate to deliver assistance faster, as speed is of the essence in humanitarian action. It’s also essential to provide people with a range of options for receiving aid, as one size does not fit all. Programmes need to be designed with the people they are meant to serve at the centre. I am very pleased that UNHCR and the SDF have chosen Ukraine for this launch, and look forward to expanding it beyond this pilot, so it can benefit many thousands more people in need of assistance as a result of the war”, said Karolina Lindholm Billing, UNHCR Representative to Ukraine.

“SDF, together with UNHCR, is realizing the promise of blockchain and pioneering a new future for the delivery of billions of dollars in aid disbursed annually. Using Stellar, we are helping get funds into the hands of those who need them – and doing it quickly, transparently, and without the need for bank accounts or credit or debit cards. We are proud to work with UNHCR to deploy blockchain innovations that will play a role in assisting those in crisis”, said Denelle Dixon, Stellar Development Foundation CEO and Executive Director.

“Today, we can see how blockchain technology allows us to scale humanitarian efforts in a way that wasn’t possible before. For fleeing Ukrainians, and primarily for those whose banks are inaccessible, this pilot project providing humanitarian assistance using a digital wallet, will serve as a possible lifeline for survival. The project itself is a vivid example of how blockchain has the potential to transform and revolutionize the way humanitarian funds are allocated. The use of blockchain technology allows humanitarian organizations such as UNHCR to be more transparent and accountable and ensure that the most vulnerable people will have access to funds provided in their name. In this way, humanitarian efforts around the world will be strengthened in an unprecedented way. The Ministry of Digital Transformation of Ukraine is grateful to SDF and UNHCR for standing with the people of Ukraine and doing this in such an efficient & modern way,” said Deputy Minister of Digital Transformation of Ukraine on IT industry development Oleksandr Bornyakov.

As reported by Ukrinform, Prime Minister Denys Shmygal said that this year the UN allocated more than 4.5 billion dollars to provide humanitarian aid to the population of Ukraine, which suffered as a result of the aggression of the Russian Federation, and to Ukrainians who left the country.