Smart contracts are providing the solution to the trust issues that are usually the main concerns in the micro loan industry. Whether it be student loans, cars, or any other kind of micro lending - blockchain technology provides what's needed to move away from the banks, and towards a peer to peer lending model.
Volerem Foundation is building the infrastructure to facilitate exactly this.
One huge advantage of taking traditional banking out of the picture and utilizing a token in the loan process - the entire world opens up. People and businesses in developing nations that may never get the ear of a banker can give their proposal, and find funding on the Volerem platform.
Founder and CEO Val Kleyman, explains the platform like this;
"You have to create a community for people to interact, and trust eachother. One way we're envisioning to do that is similar to AirBNB, where people trust who their interacting with because they trust the platform they're on. You are able to book and stay at someones place without even meeting. Then they rate eachother, and based on that you create a profile for the individual. Once you do that, you can continue to trust someone.
In terms of our world, let's say I need a micro loan to expand my coffee shop, so I go on the Valorem platform and I create a loan. Well on the platform, it doesn't give you everything right away - you have to build trust. After awhile, you've made a certin amount of payments, you've been active on the platform, your profile ranking goes up, to 5 stars or 10 star member. As that happens, more money is released to you and you can do more on the platform.
It's a balance between the valuation of the currency compared with bitcoin or the dollar, and how it translates to the platform itself and your ability to use it"
Valorem is also a multi-layered platform, the other major component being traditional payments - aimed at providing payment solutions for things such as landlords, receiving money rent payments from their monthly rent payments from tenants and other goods and services.
The Valorem ICO pre-sale is live now - participate and learn more at https://advalorem.io
