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The process of lending and borrowing is not as simple as it used to be in the years before banks existed. Apparently there is little or no trust these days which is why middlemen are now a part of the process. The middlemen might make the loaning and repayments more secure, but they actually make it more complex and costly in the process as they demand charges and chip in several formalities.

Blockchain Lending and Borrowing

Blockchain is built to solve this problem of complicated loaning and repayments. Because of it’s decentralized nature, assets can be transferred between and among people and a middleman is not required. In other words, blockchain allows for peer-to-peer lending and borrowing. It reduces the stress and difficulties lending and borrowing, and also makes it less time consuming.

With blockchain, middlemen and intermediaries are not on the train. Borrowers and lenders are the sole passengers and this means they have direct contact with each other and they would even have options to pick from on request.

There are also no geographical limitations to lending and borrowing and repaying on the blockchain. People all around the globe have access to the platform and loaning might as well be international or intercontinental, as the case may be.

A product of blockchain, smart contracts, allows lenders and borrowers to validate transactions confirm the authenticity of the parties they’re transacting with, manage accounts and enforce obligations as regards the loaning. All this is done on the blockchain speedily and with little or no cost.

Blockchain is very decentralized and doesn’t require trust. All transactions are in plain sight and both lenders and borrowers will have access to them so the need for an intermediary is killed.

When lending and borrowing is done on blockchain, the process is accelerated, simplified, open, free of middlemen and charges, and it has no boundaries. Repayments can be automated using smart contracts too. Blockchain is the best place to acquire and pay back debts!