Coil and the Mojaloop Foundation: Financial Inclusion: Let’s Do this Together

by Adrian Hope-Bailie on May 15, 2020

Categories: Blog

Tags: Member

Q&A with Mojaloop Foundation Director Adrian Hope-Bailie, Head Services and Interledger, Coil 

With the launch of the Mojaloop Foundation as a charitable organization that will support the deployment of the Mojaloop open source softwarethe inaugural Sponsor members will take on the responsibilities of providing financial, technical and legal assistance to ensure the health and growth of the user community. One of those initial Sponsor members, Coil Technologieshas been a core contributor to the development of Mojaloop. Coil’s Head Services and Interledger Adrian Hope-Bailie worked on the Mojaloop open source project during a previous stint at Ripple and was instrumental in providing guidance around the Interledger protocol. Coil joins the other initial Sponsor members of the Mojaloop Foundation, and Adrian will play a key role as a member of the organization’s inaugural Board of Directors.  

We chatted with Adrian about the transition from the open source project to the newly established Mojaloop Foundation. 

What is most exciting to you about having Coil be a foundational part of a new organization focused on Mojaloop?  

AHB: There are quite a few things. For me personally, it really speaks to a longtime passion. I’ve been involved in payments in South Africa and Africa for over a decade, and I would consider the lack of interoperability, siloed networks and inaccessibility of services for different segments of society as enormous issues. With Coil and Mojaloop, I feel like we’re part of something that’s chipping away at that problem, whether we solve it or whether we don’t, just being part of a potential solution is really exciting.  

How do you envision the other Sponsor members contributing collectively? 

AHB: It’s really exciting to have all our Sponsor members involved because of their convening power. Interoperability and standards only work if everyone comes together and develops them together. By bringing a mix of charitable and technology-based Sponsor members to work on things together, it feels like the organization is well-positioned for success, bringing everyone into a single place and saying, “let’s do this together.”  

It’s also very meaningful to have a shared mission around inclusion with so many other noteworthy organizations. I live in South Africa, as do a lot of the team that works on the Mojaloop project at Coil. On the one hand, we personally believe in the shared mission, and on the other hand, for Coil as a business, we care a lot about making sure that that next billion people who come online are not just accessing the internet, but able to pay on the internet and be able to do commerce. That’s our market.  

Talk a little more about Coil’s mission and how it dovetails with Mojaloop’s mission. 

AHB: Coil is looking to enable people on the internet to get paid and make money from the services and the content that they create. That is Coil’s entire mission. So, I think Mojaloop fits nicely into that, particularly if you’re thinking long-term about markets where Coil, as a service, is actually not yet accessible. 

In Coil’s business model, we make it easy for content creators to get paid for their content. Today, if you make a movie, write a blog post, or do anything online, earning money for it is quite difficult. You likely need to sell ads or subscriptions, or you need to put up a paywall or something similar. It’s really difficult! So, Coil is trying to change that business model and make it easier for those people.   

What a lot of people ignore is that there is a massive population of people who are looking to get paid for content in developing economies. More of those creators are moving online, and more of the potential consumers of their content are doing the same. And when those people want to start paying for content using something like Coil’s systems, how will they actually get that money into their Coil account? It’s going to be via inclusive digital payments systems and that’s where Mojaloop, and the whole Mojaloop movement, isn’t just important to us from mission-based alignment, it’s critical to our business long-term.  

I’m also very enthusiastic about the whole process of getting people to collaborate and work on open standards together and find a way to separate competitive space from collaborative space. To say out loud, “nobody wins by creating a walled garden and proprietary systems.” We should all do it the same way, and then we all differentiate ourselves in a different space. I’m personally a very strong believer in that sort of model for technical progress, and I think that I share that mindset with my colleagues at Coil, which is part of why we gravitated together to form Interledger, to get involved in Mojaloop and to create Coil. It’s all that same mindset of creating a standard, creating a level playing field that everyone can get involved in, and then the rising tide raising all boats.  

What is the value of Coil’s Interledger, and where does it fit in with Mojaloop?  

AHB: Mojaloop has taken a lot of the key concepts from Interledger and is using them. But it’s also a different network to the Interledger network, which is a micropayments network that Coil uses to make payments to creators. It’s important to note that there are quite a number of degrees of separation between the Interledger protocol and blockchain.  

Interledger, like Mojaloop, is completely agnostic to how digital money actually moves once it starts getting settled between participants. Mojaloop is designed so that payments between multiple MNOs, commercial banks, or a Central Bank can be settled regardless that they may be on different networks 

While more governments and businesses are thinking about how to be more financially inclusive, they are focused on their day-to-day operations and may not have technical resources to make a shift. How will Mojaloop address this? 

AHB: Certainly, more businesses out there want to be more inclusive. I think there’s a perception that a lot of businesses are not interested in servicing the bottom of the pyramid because that’s not their market. But I also think there’s a huge number of people who will do anything to increase the addressable market that they can serve – they just want to know how to do so. Again, that’s where interoperability and changing the cost of being part of the system moves the needle.  

When you’re coming into an ecosystem where your basic cost of entry is established and you’ve got fixed costs, it’s very difficult to get around. It’s tough to push your cost per customer down without massive growth, and so pushing down the costs to be part of the ecosystem, lets people be more cost-efficient.  That’s the benefit of interoperability for those small players.  

As you said, for so many organizations, it’s not that they dont want to be more financially inclusive; it’s just that their priorities are to either protect their existing customer base or going after new customers. When you have to fight tooth and nail for new customers, you’re prioritizing the ones that are bringing a lot of money into the system. That is obviously to the detriment of the underserved and unbanked. 

By bringing the cost of entry down, we make digital financial services more accessible to anybody. And I would say, when you look at an ecosystem where there are monopolies or participants who own big portions of the ecosystem, the first thing that’s going to drive interoperability naturally is if the rest of the ecosystem gets together, and it becomes the big player versus everybody else. That forces the big players to get into this interoperable ecosystem and not to plan their own – which again benefits everybody.