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It is entirely possible to use technology to make financial services better, cheaper and more secure: Opposing view
Think of your daily interactions with money — on your morning commute, when you’re paying bills, when you go out with your friends on payday. For many of us, there’s an app for that, we’ve got credit cards and go days without using cash.
Now put yourself in the shoes of somebody who doesn’t have access to basic banking, gets charged exorbitant fees for sending money to loved ones or relies on predatory payday lending. That’s the situation for 1.7 billion people today, including millions of unbanked and underbanked Americans.
Lost in the excitement surrounding the announcement of Libra* is the basic goal of using technology to increase financial inclusion, much like the internet reduced barriers to information and communication.
Much of the criticism of Libra pointed at Facebook misses the mark.
Libra will be governed by the independent Libra Association, a nonprofit, member-based organization that will ultimately involve a hundred diverse and globally representative organizations — each with the same powers and privileges as Facebook.
Even today, the Libra Association is made up of 28 founding members, among which are some of the world’s best known brands, global payments companies and social impact partners, like Kiva, Women’s World Banking and Mercy Corps.
Before a single Libra coin is minted, the Libra Association will engage with policymakers and other stakeholders to increase understanding of how it will operate as a reserve-backed low-volatility cryptocurrency and how its open-source technology will ensure trust, security and efficiency.
The objectives of financial inclusion, responsible innovation and competition are not in tension with regulatory oversight. It is entirely possible to use technology to make financial services better, cheaper and more secure for more people while working within the rules that have been established — for good reason — to protect the public and the financial system.
Dante Disparte is head of policy and communications for The Libra Association, a group created in part by Facebook to launch a digital currency.
*On December 1, 2020, the Libra Association was renamed to Diem Association.