DIVA Donate
Developed in partnership with Mercy Corps Ventures. Read the full report here.
With Mercy Corps Ventures, DIVA Donate piloted blockchain-based cash transfers to climate-impacted pastoralist communities in Kenya.
Website: https://www.divadonate.xyz/
HQ: Switzerland; Kenya
Active Markets: Kenya; additional markets in development.
Problem Addressed
50 million people across sub-Saharan Africa are pastoralists, living in communities depending primarily on livestock for income and subsistence, grazing their livestock in open-access pastures and moving with them seasonally. As of January 2023, pastoralism provided income for more than 95% of rural families in Northern Kenya and accounts for 90% of youth employment in the region. Economies in Kenya are reliant on rainfall and susceptible to extreme weather events and changing climatic patterns. Precipitation across the country varies greatly. Without sufficient rainfall and the resulting vegetation, pastoralist herds are unable to graze, with livestock falling victim to starvation and illness. Without income from their livestock, pastoralists and their families can suffer significant consequences, including inadequate access to food, an inability to sustain their businesses, and an inability to pay school fees, with knock-on effects for their childrens’ futures.
Project Description
Mercy Corps Ventures with DIVA Donate – a partnership between DIVA Technologies, Fortune Credit, and Shamba Network – launched a pilot using ecological data to determine donation-based anticipatory cash transfers to eligible climate-impacted pastoralists in Kenya, allowing them to benefit immediately from the receipt of funds before the impacts of the dry season were felt.
DIVA Donate’s crypto donation platform used smart contract escrows to securely and programmatically deliver anticipatory cash transfers to pastoralist communities. The smart contract at the core of this project, administered via the DIVA protocol, held donated funds in escrow and programmatically disbursed them if climate conditions were deemed distressful for pastoralists. The smart contract assessed pasture conditions using an indicator called NDVI (Normalized Difference Vegetation Index). NDVI is a leading indicator of livestock mortality since vegetation typically tracks rainfall performance.
Shamba Network developed the blockchain oracle that provided ecological data to DIVA’s smart contract. Once funds were released, local microfinance institution Fortune Credit Limited leverage their robust on-the-ground network to deliver funds to aid recipients through M-PESA accounts, which were collected at the beginning of the pilot.
Business Data
Status: Active
Constituency Served: Climate-impacted communities in the Horn of Africa, specifically pastoralists earning their living from livestock tending.
Networks: USDT, Polygon
Known Investors: Mercy Corps Ventures
Additional References: Pilot Launch Article
Progress to date
The pilot period began in October 2023 and ended January 1st, 2024. 20,235 USDT in donation funds were contributed to the pilot, with funds split between two smart contract escrows designated for each of the two rural counties served. Mercy Corps Ventures provided a donation of 20,000 USDT. 10 external donor participants contributed 126.18 USDT. The DIVA Protocol team contributed the remainder 108.82 USDT. Consistent with climate conditions reported via NDVI data and meeting the project’s thresholds, nearly all of the funds were disbursed to impacted pastoralists.
DIVA protocol plans to repeat the existing campaign, with a focus on increasing the number of participating pastoralists and further improving efficiency. DIVA plans to: onboard additional local partners, including NGOs, local government bodies, and financial institutions, which will be instrumental in amplifying the financial resources available to support the campaign and increasing the impact; implement data collection and analysis mechanisms to enhance an understanding of the needs and behaviors of both pastoralists and donors, as well as to assess the program’s impact and identify areas for improvement; and to actively pursue grant opportunities to sustain and expand these initiatives.
Business Model
DIVA Donate sustains aid through crypto donations and grants.
Traction
262 pastoralists in two Kenyan counties participated in the pilot, benefitting from donation-based cash transfers. The pilot resulted in a 75% reduction in donation transaction costs and a 90% reduction time in payments over traditional transfers. Over 53% of participants reported an improved ability to meet a major unexpected expense, and 100% of interviewed aid recipients would recommend the program to a friend.