Alice sells spices from her shop in Manila. Alice would like to access financing to buy larger quantities of spices at lower prices, which will let her keep more inventory in stock, meet customer demand, and capture larger margins.
Location: Manila, Philippines
Enterprise: Sells spices from her market stall
Jia provides inventory financing to Borrowers like Alice through local Partners, such as a hypothetical wholesaler Tropical Spices. In order to facilitate underwriting, Tropical Spices provides Jia with relevant data on merchants like Alice, such as monthly revenue, expenses, purchase history and local market trends. Jia feeds this data into its credit models to determine the optimal loan terms (interest rate, duration, and amount) for each merchant. Based on her data, Jia extends Alice a loan offer to finance up to $1,000 of spices.
When Alice repays the loan on time, she receives JIA token rewards. This may be Alice's first cryptocurrency, so Jia includes extensive education in its app to break down the benefits of JIA and provide onboarding into the world of Web3. As a Borrower, Alice will likely use her JIA tokens to unlock credit rewards such as lower interest rates, larger loan amounts and longer durations.
Building On-Chain Credit History
As Alice repays successive loans, she builds credit history with Jia that will reflect positively on her for future loan applications. Because Alice's credit history with Jia is tracked on-chain, protocols offering other financial services will be able to verify her creditworthiness and serve her accordingly. As a result, by borrowing with Jia, Alice has gone from an entrepreneur with no Web3 footprint to one that can access every type of financial service she might need to grow his business on-chain.
Alice knows another market vendor named Bob who wants to take a loan. Bob only recently started partnering with Tropical Spices, so they do not yet have sufficient data about Bob for Jia to offer her a loan at this time. But Alice knows that Bob is a savvy businessman, so she secures a loan for him by depositing some of her on-chain assets into the Collateral Pool. As Bob repays the loan, the Lending Pool and Lenders are repaid as before, but Alice also gets a share of the interest to compensate her for securing Bob's loan. If Bob defaults, Alice's collateral is liquidated and used to recapitalize the lending pool.
Alice's Journey with Jia
Today, Alice cannot grow her business because of inadequate access to financing. The options she has are likely transactional, perhaps giving her access to expensive financing, but no ownership in the upside of the lending enterprise. Let's consider where Alice will be after building a successful borrowing relationship with Jia. By accruing JIA, she will not only be a customer on the end of a one-way transaction with a lender; she will be an owner and builder of the community, participating in governance and helping determine the future of the protocol. She will have a financial stake in the future success of the protocol, thus gaining an opportunity to build wealth and prosperity for herself, her family and her community.
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