La Libra, Facebook's digital currency, announced for 2021 in reduced format

The launch of Facebook's digital currency, Libra , could take place in 2021. The project may benefit from favorable factors in the global economy, but regulators will have to be convinced first.  Facebook could launch Libra, its digital currency in 2021, we learn from the British media Financial Times, which quotes people close to the process. The product is expected to arrive in a limited version, after the project has met with great aversion from regulators, including in the United States, the country where the headquarters of the social media management company are located. The stakeholder association behind this digital currency project is now planning to launch a single version of Libra that will itself be pegged to the dollar, at the rate of one unit of US currency for each Facebook digital currency . “The other forms of currencies will be deployed at a later stage,” the FT source added. The exact launch date will depend on when the project

Grants 2.0: How about the Informal Bonds?

Even today, the preponderant part of the financing of our savings goes to the banking sector, with the drawback of establishing the banker as a multi-sector specialist. This brings together within the same client portfolio, agribusiness, energy, consultancy and new technology entrepreneurs.
 
How about the Informal Bonds

We also have high-end financing players such as Private Investors who, for reasons of efficiency in monitoring their investments, generally limit themselves to large-scale investments, knowing that some of them ( unfortunately) have oriented their investment strategies towards the Small and Medium Enterprise sector.

On the other hand, we have Microfinance which due to its popularity denotes a financing model adapted to small economies but which unfortunately experiences certain abuses with the application of usurious rates.

We could have mentioned financing by Meso finance which is still recent and which is situated as an intermediary between bank and micro-bank financing or Nano-credit (system for granting credits generally less than 100,000 FCFA offered by some Fintechs of the place) and which are still weakly popularized.




And finally, we have an informal and parallel financing system that has been created, a kind of financing by the street (or pawnbroking), applying excessive interest rates with among the required guarantees, the bank card of the borrower.

Faced with this situation which highlights an oversight of the informal sector, or at least a financing system not suited to this category of our economy which nevertheless represents more than 85% of jobs on the continent according to a study by the International Organization of Work, it becomes necessary to define an alternative but above all differentiating financing mechanism.

The Informal Sector, our survival mattress

The informal sector constitutes for the vast majority of Africans a survival mattress. To take the case of Europe, the survival mattress is defined there by each state, in the form of a Social Model. Thus, in each country, a Minimum Wage has been fixed (called minimum wage) allowing each worker to provide for the basic needs of his family. In France, a person who finds himself unemployed can even benefit from a Minimum Solidarity Income called the RSA while waiting to find a job.

In Africa, this survival mattress is characterized by our informal activities. The contract agent of a public administration who earns 65,000 FCFA / month (i.e. € 100) and who is the head of a family with 6 children, needs to develop an informal activity in parallel to make ends meet. , if only for the food survival of his family.




Funding our informal economy would therefore amount to funding our social protection. The informal cannot remain the "Forgotten Large", or the "Evil Tooled" of our economy as it is today.

We have always wanted to adapt our African Stock Exchanges according to the socio-economic characteristics that govern our societies. Today, the African Financial Market, should represent Hope, the Alternative, compared to financing mechanisms which although diversified, today did not allow to satisfy this segment so representative of our economy.

This Financial Market 2.0 should allow us to immerse ourselves in our daily operating methods. Each actor in our economic chain should be able to identify an opportunity through this Financial Market.

This is how we are proposing the implementation of a new product that could be called Informal Bond.

Informal Bond: What is it?
According to a report by the International Monetary Fund (2017), the informal sector represents, according to African countries, between 20% (South Africa) and 65% (Benin, Nigeria) of their Gross Domestic Product. Contrary to popular belief, it is not always badly organized. Some of its activities are organized into "Corporations / Cooperatives / Groupings". For example, groups of Planters, groups of motorbikes, etc.

The idea is simply to allow groups that have demonstrated (historically) good organization and good governance to apply for funding for their members via the Financial Market by issuing what we would call a Informal Bond (Obligation dedicated to the financing of informal activities).

This issue would be directly initiated by the Group Managers who would have previously selected (thanks to their knowledge of the sector and their members) the beneficiary members as well as the amounts of the loans granted for each of them.

Based on the principle that the group has previously demonstrated moral probity, it could be envisaged that all or part of this issue is guaranteed by a bank or a state guarantee fund. This would reduce the cost of this debt, the maturity of which would not exceed 18 months.

For security and transparency reasons, in this digital age, loans and repayments would be made directly by Mobile Money between the custodian bank of the operation and these entrepreneurs in the informal sector.

To summarize our point, after the primary and secondary compartments for large companies, after the 3rd compartment dedicated to the listing of small and medium-sized businesses, it is time to develop within our Stock Exchanges a 4th compartment dedicated to financing of the informal sector.