Xend Finance Looks To Bring DeFi Adoption To The Underbanked

The Xend platform is undertaking several initiatives to spread awareness about DeFi and foster its adoption.

Xend Finance and Leveraging DeFi in Africa

One of Africa’s finest DeFi ambassadors, Xend Finance, is on a mission to promote the adoption of the DeFi alternative to the underbanked. BSCNews recently had an exclusive chat with the CEO of Xend Finance, Aronu Ugochukwu. Aronu bared his mind on what Xend is doing to bring DeFi adoption to the underbanked.

Factors such as high banking charges, lack of KYC documents, and distance from financial institutions are some of the reasons why these people do not have access to financial services. According to the World Bank, about 1.7 billion people worldwide are underbanked.

A key promise of Decentralized Finance (DeFi) is to provide the underbanked with access to financial services. DeFi removes the barriers of centralised financial systems. With DeFi, anyone anywhere with a mobile phone and internet access can make financial transactions and access services such as loans, cross border payments etc. 

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A Practical Use Case

Like Nigeria, where Aronu hails from, most African currencies have low-purchasing power. Frequent devaluation and inflation of African currencies make the already bad financial state of people even worse. The result is that even when people try to save, their savings progressively depreciate in value.

Aronu and the Xend team saw this problem and thought of devising a way to solve it. Xend provides a platform for people in unstable economies to convert their local currencies into stablecoins. Xend then leverages multiple DeFi lending protocols that give good returns. Xend thus helps people to protect the worth of their assets and earn returns on them. 

The Focus

Another issue identified by Xend is the low awareness in the general African population about how crypto and blockchain function. To help bridge the awareness barrier, Xend has created educational materials which can be accessed here. These materials l break down the fundamentals of blockchain and DeFi in simple terms. Xend also partners with educational firms to get the word out to the financially underserved majority population. In addition, Xend organises seminars and symposia throughout Nigeria. 

Why Xend Chose To Go With Stablecoins

1. Target-Audience

Xend chose Stablecoins because of the nature of the target-audience. The target market does not want to see its assets lose value. Venturing into yield farms that use unstable cryptocurrencies will cause people to worry about changing prices; The problem will be compounded rather than solved. 

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2. Risk Management

Part of Xend’s strategy is to reach out to institutional investors and traditional finance houses. These firms will not be willing to entertain any discussion that has high risk embedded in the proposal. The stability of Stablecoins is Xend’s central selling point to the traditional centralised finance sector (CEFI). 

Xend’s low-risk investment approach is paying off already. According to Arona, the firm’s total value locked (TVL) grew by about 400% in June 2021. 

3. System Security

Supporting multiple tokens, as stated by Xend’s CEO, will increase the possible points of failure. So the platform went a bit minimalistic at the early stages and will gradually support more tokens. 

Future Outlook

Xend is currently working on a number of new features that will increase adoption and strengthen the platform. These include:

Xend is looking to enlarge its user base. A referral program to drive organic growth is ongoing. Referrers will be rewarded with 50% of the platform fees accruing to Xend from one’s referral. 

Xend Finance is one of the first African startups to deploy a thriving blockchain/DeFi protocol successfully. The platform is working on being a springboard for upcoming African projects to leverage for success in the DeFi-space. 

Xend has entered into a partnership with BlockBank. As part of the partnership, a fiat gateway for Xend will be enabled on the BlockBank app. Users will be able to purchase XEND with fiat. The XEND community will also take advantage of BlockBank’s artificial intelligence tools and make better investment decisions. The integration of Xend Finance into BlockBank is expected to be completed by July 2021. 

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Xend Finance, before the end of July 2021, will deploy on Polygon. The platform plans to implement yield-farming to increase liquidity and boost yield through multiple partnerships on Polygon.

Final Words 

Our chat with Xend Finance’s CEO revealed the energy and drive propelling the platform. It is praiseworthy that Xend is leveraging DeFi to solve a real-world problem. As the platform’s current and future initiatives mature, the statistics of the unbanked in Africa and the world will hopefully diminish.

About Xend Finance

Xend Finance is the first DeFi platform for credit unions and cooperatives. The platform provides a DeFi alternative for people in unstable economies to earn on their savings while protecting their assets from inflation and local currency devaluation. 

Source : bsc.news

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