BienVivir is a traditional micro-credit company operating in México. This company offers credits that go from $125 to $2,500 USD to micro business owners. The credits are repaid in short cycles that range from six to eighteen weeks. The company is highly profitable as it operates in a high risk niche that is neglected by both traditional and neobanks. The customers are self-employed micro business owners operating at the local level, most of commercial niches from the customers are corner shops, butcher shops, hardware shops, typical meal preparation shops, clothes shops, and some others are taxi drivers.
All credit offered is for production or selling (re-investing in their business) and not for personal credit.
Most of the customers of BienVivir use the credits for three reasons: buying inventory at a lower price than what they are capable of buying with their current cash flow, buying equipment, and paying services like rent, taxes, permissions, utilities, or remodeling their shops.
When customers of BienVivir do not pay back on time it is mainly because they got sick or they had a personal emergency that made them close their shops or their cash flow went to cover those emergencies. However, people don't want to lose their credit line so they payback even if in shorter pays through a longer period, until eventually they fully payback.
Micro business owners are characterized to be fragile regarding health issues, extorsions from the mafia and government supervisors, inflation, and climate phenomena. In summary, they do not count with any safety net and are constantly affected by third parties profiting from them.
Looking at this context, BienVivir decided to carry on an “Exit to Community”, meaning that profits, decision-making, and power are to be held by its workers, customers, and investors.
BienVivir aims to marry the concepts of exit to community with the power of the blockchain technology to have a transparent, automated, and decentralized company that can support micro business owners and workers to gain freedom by possessing the means of production and collectivizing their decision-making.
It is to be noted that the company has already achieved to provide credits from funding to repayment completely in crypto, and now is going through several processes:
Transitioning from local capital to DeFi --> Lowering the interest rates by funding our customers with capital from all over the world via DeFi.
DAO treasuries --> Setting up all the participatory budgets via multisigs and normal wallets
Automation --> Accounting reports; Investment to Credit Allocation
Governance --> Co-designing with the stakeholders involved the guidelines for each of the participatory budgets
For this RnDAO <> Arbitrum CoLab fellowship we will focus on the DeFi transitioning. We are researching about credit scores that start with RWA (real world assets) and then grow with web3 transactions.