NPR

Does Facebook Need A Humanitarian Partner For Its New Digital Currency?

The aid group Mercy Corps believes that the new Libra currency could help funnel aid to the poor. But critics wonder why the charity has teamed up with a controversial company.
With a mobile phone, Kenyans can send and receive money via a service called M-PESA. Now Facebook is entering the digital currency realm. The social media giant has helped develop a digital currency called Libra that plans to launch in 2020. Source: Nichole Sobecki for NPR

It's not easy giving money to people in need.

In some countries, poor people may not have a bank account where a charity can transfer funds for financial aid. They may not have the ID — say, a birth certificate — required to cash a check at a bank.

And in an emergency situation — say, the aftermath of an earthquake — banks may not even be operating.

Could a single global digital currency — one that can be transferred through mobile phones — be a solution?

That's the way that Libra will operate. It's a new currency incubated at Facebook and announced in June. Libra, according to its website, wants to "reinvent" money by making a financial transaction as cheap and simple as "sending a text message or sharing a photo."

The main goal isn't to help out in humanitarian situations. But Mercy Corps, one of the world's largest relief groups, is so impressed with the potential benefits that it established a partnership with Libra this spring. And it's a high-profile partnership. When a Facebook executive testified about Libra before members of Congress this past week, he mentioned the Mercy Corps connection as a way of building up Libra's credentials.

But the partnership does raise questions. Not everyone in the aid from the U.S. Federal Trade Commission for privacy violations.

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