Implementing a Blockchain system in Zimbabwe

Shaun Nyagumbo

This week we bring you this article by Shaun Nyagumbo, the founder of SUNFund Africa, a Zimbabwean based Blockchain and Cryptocurrencies company. Shaun shares his thoughts on how Blockchain can be used in Zimbabwe.

Over the last 10 years Blockchain went from being a mythical technology, to an industry buzzword, to now being an industry standard in certain sectors. The revolutionary ability of Blockchain has become a central focus in creating solutions to legacy systems, facilitating for the streamlining of certain functions and disrupting existing sectors. Blockchain is finding itself being used by Fortune 500 companies like Microsoft, IBM, JP Morgan, Deloitte and very soon Facebook.

Today we will look into 3 finance use-cases in Blockchain, out of the many Industrial-use cases being explored today. But before we go into the use cases, let us first demystify Blockchain Technology itself.  What is it? As the name suggests:

Blockchain is essentially a ‘block’ of information that is ‘chained’ together in an immutable digital distributed ledger through a process called method ‘hashing’.

That is a mouthful isn’t it?  Let us try and simplify it a bit. For example, think of high school where a subject like history required a lot of notes to be written, maybe 3 or even 5 notebooks a year covering different topics in history. Think of these notebooks as ‘blocks’ of information. You would name each notebook according to a sequence i.e. Notebook 1; Notebook 2; Notebook 3 and so on. By doing this you are essentially ‘chaining’ that information together to create an easily traceable record for reference purposes. The teacher will then mark the notes to verify the information and sign the notes, essentially ‘hashing’ the sequential information in all the blocks (books). This is essentially a type of Blockchain system.

The Blockchain system is however not maintained by a single or central authority but by a network of anonymous computers (collaborators) that maintain the network and get remunerated for their efforts, usually through the native cryptocurrency of that platform. We will touch more on cryptocurrencies later.

Any computer has access to the distributed ledger and can become a collaborator on the network. This is how the system is decentralized and immutable because to alter information that has been hashed you will need consensus from all network maintainers (collaborators) – remember these are anonymous computers. It is on this strength and innovation that various institutions have started using this technology in their businesses. JP Morgan has created the JPM Coin to anchor part of their over $1 trillion lending portfolio.


1) Cryptocurrencies

These have been demonized over the years due to the overall perception of Bitcoin in particular. But what are cryptocurrencies? To understand them better, I need you to shut your brain from everything you have been told for a moment, and grasp this simple explanation of cryptocurrencies.

Think of Blockchain as the Social Media of Finance. In social media, the goal is transmission of information on a peer-to-peer network at a low cost. Facebook, Twitter, WhatsApp are different platforms that enable you to send information in real-time on a peer-to-peer network without needing a Post Office Box. Cryptocurrencies enable the transmission of finances on a peer-to-peer network at a low cost, through the use of digital tokens that have a financial value, without the need of a financial intermediary. The purpose is to enable micro-transactions at a very low cost.

Back to Social Media, Facebook and others have shares that trade on the New York Stock Exchange (NYSE); this is how these companies were able to raise money to finance expansion. People buy these shares in hope of later gain based on a positive performance of the company in the future.

Blockchain companies raise capital through the issuance of digital tokens (cryptocurrencies) that are indirectly connected to the financial performance of the Blockchain system as well as performance on the Cryptocurrency exchanges it is listed on. The only difference is that these cryptocurrencies are also usable as a medium of exchange (payment method) within the Blockchain system.

So, imagine being able to use Econet or Old Mutual shares that you own to pay for goods and services, as well as receiving them as payment. This is essentially what cryptocurrencies do. Marginalized companies are able to launch crowdfunding Initial Coin Offerings (ICOs), that enable them to raise capital to finance ventures with investors getting digital tokens (cryptocurrencies) that serve as a share in the business or reward the investor with a certain quantity of goods and services the promoting company is offering.

2) Trade Finance

“Trade Finance” refers to the domestic and cross-border financial transactions supporting the trading of goods. Trade transactions involve a supplier and a buyer of goods and services, facilitated by intermediaries such as financial institutions, providing funding and mitigating credit risks.

Trade finance addresses these requirements with well-established instruments to provide:

  • Financing
  • Tracking
  • Execution of payments

One of the difficulties involved with trade finance is the large volume of paper-based documents sent back and forth between suppliers, buyers, funders, shipping companies, insurers and other parties. As a result, there is a restricted profile of viable trade finance customers, limiting scalability and liquidity in the trade ecosystem. Management of credit risks and regulatory requirements on trade finance such as:

  • Sanctions
  • KYC (Know-Your AML
  • Anti-Money Laundering
  • Fraud prevention

The Blockchain can place all the necessary trade finance information as a digital document, which is updated nearly instantly and is viewable be all members of the trade ecosystems in a decentralized manner at the same time to streamline the transactions being undertaken by the stakeholders.

3) Accounting

Blockchain works as an immutable ledger that gives network collaborators access to information in real-time regardless of geographical location. This function enables transparency in information, which is critical in the accounting industry where various stakeholders have their interest at stake i.e. Revenue Authorities, Shareholders; Creditors and other relevant interest groups.

Blockchain-based accounting systems enable transactions to be recorded in real-time and gives authorized stakeholders real-time access to the accounting records of the interested businesses. Through the use of API’s, Blockchain systems can be integrated with banks to enable Smart Contracts that automatically calculate the obligations like QPDs, PAYEs, NSSA, NEC and other stakeholders and semi- or fully execute remittances on the stipulated dates.

This will help with collections and plug many leakages while also enable Micro, Small and Medium (MSMEs) to securely create and market custom tokens, as the investor will have access to accounting records that cannot be manipulated, since they will run on Blockchain, to make informed decisions.

That’s it for this edition. Should you require more information or need consultancy in developing a system for your organization, you can contact us on Tech Hub on +263718924393 or email We will gladly facilitate the implementation of a system through our Blockchain partners.

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