Blockchain technology is currently one of the most prominent technologies. It is at the center of national, international, and corporate policy discussions. This is unsurprising, as blockchain technology provides truly revolutionary features like immutability. However, while blockchain’s utility to government institutions and large corporate organizations has been widely discussed, its possible benefits to small businesses have been barely highlighted.
Blockchain Technology in the Middle East
The Middle East has become an active user of blockchain technology in recent years. Many countries have opened their territories to blockchain deployments, with government institutions adopting blockchain technology for their operations. For instance, Bahrain recently granted Binance a license to operate as a crypto asset provider.
In 2020, the Saudi Arabian Monetary Authority (SAMA) also announced that Saudi Arabian banks would use blockchain technology for money transfers. In fact, the SAMA announced that it utilized blockchain technology to deposit about $13.3 billion as a liquidity package for the Kingdom’s banking sector. These trends depict blockchain technology’s stronghold in the Middle East.
How Blockchain Technology Empowers Small Businesses
Small businesses account for most of the businesses in the global commercial ecosystem. There are estimates that over 332 million Small and Medium Enterprises (SMEs) exist across the world. Small businesses also account for up to forty percent of all employment in the Middle East and North Africa.
The benefits of blockchain technology for small businesses are numerous. First, blockchain technology gives small businesses access to global markets. This is because of the seamless and cross-border payments that blockchain enables. For instance, Middle Eastern companies seeking to expand their customer base to Europe can quickly receive payment from European customers through cryptocurrencies on the blockchain network. This enables Middle Eastern small businesses to grow their bottom line.
Also, blockchain technology reduces the chargebacks that affect small businesses. With the way blockchain technology is wired, payments are irreversible. Thus, customers cannot merely dispute payments and request reversals from their financial institution. This reduces malicious chargebacks that impact the profits of small businesses.
Another benefit of blockchain technology is safer data storage. Small businesses will likely process more data and require safe storage as they amass more customers. Blockchain enables safer data storage by ensuring that data is encrypted and distributed to a decentralized network. This means that a central entity does not control data. Thus, uploaded data cannot be easily manipulated, altered, or deleted. This benefit is particularly vital for small businesses that intend to significantly expand and scale their operations.
Conclusion
Blockchain technology’s use cases hold numerous benefits for small businesses across different sectors in the Middle East. Thus, more businesses need to explore the possibility of adopting blockchain technology for their operations.
