World Food Programme Steps Up Aid with Blockchain Tech

Better verification in the field, plus potentially lower transaction fees, mean more efficient aid.

Adam Stone

As part of the United Nations' goal of reducing or eliminating world hunger, the World Food Programme (WFP) is looking to blockchain technology for assistance with international transactions. While the traditional method of funding through direct cash transfers helped create the food aid ecosystem, it’s also relatively costly and vulnerable to manipulation. Cryptocurrency news site posits that intermediaries and middlemen make up much of the high cost of international transactions. 

The WFP believes that distributed ledger technology may help combat funding loss from traditional international transfers. To this end, it chose the versatile Ethereum blockchain project to assist in distribution. This fully removes banks from the process, as the Ethereum platform transfers cryptocurrency directly to the merchant at the point of sale. 

A May 2017 pilot program tested confirmation through iris-scanning technology. notes that Syrian refugees in Jordan were iris-scanned to verify they received aid. Afterward, the smart contracts embedded in the blockchain released the funds held in escrow for the merchant. The nature of a distributed ledger system helps guard against fraudulent transactions, as many of the nodes necessary for validation are entirely outside of the country where the transaction occurs. 

According to a February 2018 Bloomberg report, the head of a WFP innovation lab in Munich estimated that blockchain technology could reduce banking fees incurred during the Jordan test program by 98 percent. Such savings represent a significant amount of funding that can now be reallocated to providing more food aid, as opposed to paying for transactions along the path to the aid recipient. Combining distributed ledgers with transaction verification in the field could significantly increase aid impact worldwide.