WHAT IS SOCIAL CREDITS?
Social Credits has 3 Core Functions:
BLOCKCHAIN ECOSYSTEM
Social Credits ecosystem facilitates transactions involving impact investing, blended finance, multilateral aid and financing. Smart contracts allow payments connected to the agreed outcomes. Transaction costs would reduce with increased efficiency as the platform grows—making sustainable development transactions more attractive for private investments.
CRYPTO CURRENCY
Within the ecosystem, Social Credits can be transferred as digital currency for sustainable development. As various sovereigns recognize the incentive mechanism (next pages), the value of Social Credits can be agreed by the participating countries. This way, the pricing of Social Credits would stay consistent with the monetary systems—complementing and enhancing them.
INCENTIVE MECHANISM
Over $7 trillion are needed every year for infrastructure, sustainable development and climate-related projects. Mobilizing private capital for all these projects is critical, and using innovative tools like Social Credits would be a key to attracting private capital for sustainable development. The mechanism is explained further in the next pages.
THE CHALLENGE
Harnessing Private Capital
160+ trillion available
Global private financial wealth (2014)
$130 billion available from Microfinance
$50 billion available from crowdfunding
$30 billion available from impact investments
The private capital needs to be harnessed to broaden the supply-side of development finance. With proper incentive structures and mechanisms, private capital can not only help narrow financial gap but in doing so, will benefit from accessing a market of over 3 billion people living under $2.5 a day. Better incentives, such as social credits, can help scale up the existing market-based financial inclusion solutions and enhance their social impact.
EVEN WITH 160 TRILLION AVAILABLE, PRIVATE INVESTMENT STILL REMAINS LIMITED
BARRIERS TO USING PRIVATE FINANCIAL WEALTH
Absence of Right Incentives
Absence of FDI Regime
Political Risks
Absence of Information
HOW SOCIAL CREDITS’ INCENTIVES WORK
Any one of the following can be incentivized using social credits:
IN KIND
In Kind contributions for capitalization of a new company
SHARES
Issuance of new shares by a qualified group of eligible small and medium businesses
DONATION
Donation to a qualified non profit entity
TAX LIABILITY
Qualified tax liability
The Incentive Structure will help attract Foreign Direct Investment (FDI) and local investments for social and economic development sector including:
In order for a FDI project to claim Social Credits, it must go through these three steps:
PRE CERTIFICATION
- The economic condition of the host country
- Cost off-set of the project
- Social impact of the project
- Critical nature of the project
CERTIFICATION & ISSUANCE
The socio-economic impact of the project is measured and verified in accordance to the agreed upon quantification criteria.
REDEMPTION
Once certified, the private sector participant can redeem social credits in either of the pilot countries in accordance with the bilateral agreements.
THE SOCIAL CREDITS PILOT
We are excited to start our first pilot this year
THE FIRST SOCIAL CREDITS PILOT WILL BE BETWEEN UK AND SOUTH AFRICA
GOVERNANCE
The hierarchy of our initiative is very important to keep a balance
Click to learn more about each tier
Initiative Principles, Core Team, Initiative Secretariat
The Initiative Principles are responsible for the overall supervision of the Initiative. The Core Team is the managing body. that will drive and coordinate amongst all the relevant stakeholder to ensure the implementation of the SCM. It is responsible for establishing the general framework for the implementation plan. The Core team may elect its chair. The Initiative Secretariat is responsible for the overall coordination among all the stakeholders.
Global Board of Advisors
The Global Board of Advisors represents a diverse group of high-profile public and private sector leaders who are country-specific experts and influencers. Members of this board may include prominent individuals and decision-makers in different countries and can help build a support network for the initiative. The Global Board of Experts represents a cross industry network of leaders that possess the knowledge, experience and insights with regards to the technical issues being confronted while developing the implementation plan for the Social Credits mechanism. The main responsibility of this board is to provide expert advice on issues requested by the core team, and provide their expert advice of any document that the core team presents for their review.
Global Board of Advisors
The Global Board of Advisors represents a diverse group of high-profile public and private sector leaders who are country-specific experts and influencers. Members of this board may include prominent individuals and decision-makers in different countries and can help build a support network for the initiative. The Global Board of Experts represents a cross industry network of leaders that possess the knowledge, experience and insights with regards to the technical issues being confronted while developing the implementation plan for the Social Credits mechanism. The main responsibility of this board is to provide expert advice on issues requested by the core team, and provide their expert advice of any document that the core team presents for their review.
YGL Support Group
The YGL Support Group provides general support and feedback for the initiative by getting engaged as frequently as convenient and getting periodic updates on the progress of the initiative.
Strategic Support Group
The Strategic Support Group provides industry perspective, feedback and support for the initiative by getting engaged as frequently as convenient and getting periodic updates on the progress of the initiative.
CORE TEAM
We have some of the most brilliant minds from across the world
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